Notice of Annual Meetingand Proxy Statement

Annual Meeting of ShareholdersWednesday, February 8, 2017

December 23, 2016

Dear Atmos Energy Shareholder:

You are cordially invited to attend the annual meeting of shareholders on Wednesday, February 8,2017, at 9:00 a.m. Central Standard Time, at the Charles K. Vaughan Center, 3697 Mapleshade Lane,Plano, Texas 75075.

The matters to be acted upon at the meeting are described in the Notice of Annual Meeting ofShareholders and Proxy Statement. In addition, we will review the affairs and progress of the Companyduring the past year and discuss the results of operations for the first quarter of our 2017 fiscal year.

Your vote is very important, regardless of the number of shares you hold. Whether or not you planto attend the meeting in person, please cast your vote, as instructed in the Notice of InternetAvailability of Proxy Materials (“Notice”) or proxy card, over the Internet, by telephone or on theproxy card, as promptly as possible. If you received only a Notice in the mail or by email, you mayalso request a paper proxy card to submit your vote by mail, if you prefer. However, we encourage youto vote over the Internet or by telephone because it is more convenient and conserves natural resources,as well as saves on printing costs and postage fees.

On behalf of your Board of Directors, thank you for your continued support and interest in AtmosEnergy Corporation.

Sincerely,

Robert W. Best Kim R. CocklinChairman of the Board Chief Executive Officer

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FORTHE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON FEBRUARY 8, 2017:

This Proxy Statement, along with the Company’s Annual Report, which includes our AnnualReport on Form 10-K for the fiscal year ended September 30, 2016, are available on the Internet

at www.proxyvote.com.

ATMOS ENERGY CORPORATIONP.O. Box 650205

Dallas, Texas 75265-0205

NOTICE OF ANNUAL MEETINGOF SHAREHOLDERS

To Our Shareholders:

The annual meeting of the shareholders of Atmos Energy Corporation will be held at the Charles K. Vaughan Center, 3697Mapleshade Lane, Plano, Texas 75075 on February 8, 2017, at 9:00 a.m. Central Standard Time for the following purposes:

1. To elect the 13 directors named in the proxy statement for one-year terms expiring in 2018;

2. To ratify the Audit Committee’s appointment of Ernst & Young LLP (“Ernst & Young”) to serve as theCompany’s independent registered public accounting firm for fiscal 2017;

3. To act upon a proposal for a non-binding, advisory vote by the shareholders to approve the compensation of thenamed executive officers of the Company for fiscal 2016 (“Say-on-Pay”); and

4. To transact such other business as may properly come before the meeting or any adjournment thereof.

Shareholders of record of our common stock at the close of business on December 15, 2016, will be entitled to notice of, and tovote at, our meeting. The stock transfer books will not be closed. Your vote is very important to us. Regardless of the number ofshares you own, please vote. All shareholders of record may vote (i) over the Internet, (ii) by toll-free telephone (please see theproxy card for instructions), (iii) by written proxy by signing and dating the proxy card and mailing it to us or (iv) by attending theannual meeting and voting in person. These various options for voting are described in the Notice or proxy card.

For all shareholders who participate in our Retirement Savings Plan and Trust (“RSP”), your vote over the Internet, bytelephone or on your proxy card will serve as voting instructions to the trustee of the RSP, the Atmos Energy Corporation QualifiedRetirement Plans and Trusts Committee (“RSP Trustee”). If you own shares through the RSP, only the RSP Trustee may vote yourplan shares even if you attend the annual meeting in person. Your vote will remain confidential. If you do not instruct the RSPTrustee, the unvoted shares allocated to your account will be voted by the RSP Trustee in its best judgment. In addition, State StreetBank and Trust Company, an affiliate of State Street Corporation (“State Street”), is the independent fiduciary for the RSP for thepurpose of ensuring the confidentiality of the RSP participant voting process. Please notify State Street if you have specificconfidentiality concerns relating to exercising your right to direct the RSP Trustee by writing to Sydney Marzeotti, Vice President,State Street Bank and Trust Company, One Lincoln Street, Boston, MA 02111.

All shareholders who hold shares in “street name” in the name of a broker, bank or other nominee (“broker”) may submit yourwritten votes through voting instruction forms provided by your brokers. If you hold shares in street name, you may also generallyvote your proxy over the Internet or by telephone, in accordance with voting instructions provided by your broker. Brokers do nothave the discretion to vote the shares of customers or clients who fail to provide voting instructions on any of the proposals listedabove, except the proposal to ratify the Audit Committee’s appointment of Ernst & Young to serve as the Company’s independentregistered public accounting firm for fiscal 2017. Therefore, if you do not provide instructions to your broker to vote your shares,the broker may vote your shares only on that one proposal at our annual meeting. In addition, if you own your shares in street nameand you intend to vote in person at the meeting, you must first obtain a legal proxy from your broker and bring it to the annualmeeting.

We encourage you to receive all proxy materials in the future electronically to help us save on printing costs and postage fees,as well as to conserve natural resources in producing and distributing these materials. If you wish to receive these materialselectronically for next year’s annual meeting, please follow the instructions on the proxy card or on our website atwww.atmosenergy.com under the “Investors” tab.

By Order of the Board of Directors,

Louis P. GregorySenior Vice President, General Counseland Corporate Secretary

December 23, 2016

TABLE OF CONTENTS

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PROXY STATEMENT OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1GENERAL MEETING MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Date, Time, Place and Purpose of Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Internet Availability of Proxy Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Revocability and Voting of Proxies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Solicitation of Proxies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Common Stock Information; Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Quorum Requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Broker Non-Votes and Vote Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

CORPORATE GOVERNANCE AND OTHER BOARD MATTERS . . . . . . . . . . . . . . . . . . . 7Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Independence of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Related Person Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9Board Leadership Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12Lead Director and Communications with Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Committees of the Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Independence of Audit Committee Members, Financial Literacy and Audit Committee

Financial Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15Independence of Human Resources Committee Members . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15Other Board and Board Committee Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

PROPOSAL ONE—ELECTION OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16Procedures for Nomination of Candidates for Director . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17Qualifications for Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17Nominees for Director . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18Retiring Director . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

DIRECTOR COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25Annual Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25Long-Term Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26Share Ownership Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26Summary of Cash and Other Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27Director Deferred Board Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

BENEFICIAL OWNERSHIP OF COMMON STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29Security Ownership of Certain Beneficial Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29Security Ownership of Management and Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30Section 16(a) Beneficial Ownership Reporting Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . 30

PROPOSAL TWO—RATIFICATION OF APPOINTMENT OF INDEPENDENTREGISTERED PUBLIC ACCOUNTING FIRM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Audit and Related Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31Audit Committee Pre-Approval Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32Audit Committee Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

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PROPOSAL THREE—NON-BINDING, ADVISORY VOTE ON APPROVAL OFEXECUTIVE COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Background of the Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34Human Resources Committee Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

COMPENSATION DISCUSSION AND ANALYSIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Executive Compensation Program Objectives and Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . 38Elements of Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39Additional Information on Named Executive Officer Compensation . . . . . . . . . . . . . . . . . . . 45Competitive Executive Compensation Benchmarking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45Executive Compensation Consultant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47Management’s Role in Setting Named Executive Officer Compensation . . . . . . . . . . . . . . . . 47Share Ownership Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48Executive Compensation-Related Polices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48Compensation Risk Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

NAMED EXECUTIVE OFFICER COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51Summary of Cash and Other Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51Grants of Plan-Based Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54Outstanding Equity Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55Vested Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56Retirement Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56Retirement Plans Table . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58Change in Control Severance Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59Potential Payments Upon Termination or Change in Control . . . . . . . . . . . . . . . . . . . . . . . . . 60

OTHER MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66Shareholder Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66Other Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66Annual Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

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PROXY STATEMENT OVERVIEW

This overview provides only highlights of information contained elsewhere in this proxystatement to assist you in reviewing the proposals to be acted upon at our annual meeting ofshareholders. Please read the entire proxy statement before voting because this overview does notcontain all the information you should consider.

Fiscal 2016 Financial Highlights

‰ We have continued to deliver strong financial results, generating net income of $350.1 million,or $3.38 per diluted share, representing over a 9% increase compared to fiscal 2015 and over a14% increase compared to fiscal 2014.

Earnings Per Share

2014 20162015

$2.96$3.09

$3.38

‰ We have also continued to deliver outstanding positive returns to our shareholders,generating total shareholder returns (stock price appreciation and reinvested dividends)(“TSR”) over the one, three and five-year periods, as shown in the following chart:

Total Shareholder Return

1-year 3-year 5-year0%

30%

60%

90%

120%

150%

180%

31% 30%

15%

90%

69%

37%

170%

133%

113%

Atmos Energy Peer Group(a) S&P 500 Index

(a) The Atmos Energy peer group used in this chart is the same peer group that was used in determining the level ofperformance under our incentive compensation plans, as well as in the stock performance graph in our Annual Report onForm 10-K for the fiscal year ended September 30, 2016, and is comprised of the following companies: AGL ResourcesInc.; CenterPoint Energy, Inc.; CMS Energy Corporation; NiSource Inc.; ONE Gas, Inc.; Piedmont Natural GasCompany, Inc.; Questar Corporation; Spire, Inc. (formerly The LaClede Group, Inc); TECO Energy, Inc.; VectrenCorporation and WGL Holdings, Inc. However, because AGL Resources Inc., Questar Corporation and TECO Energy,Inc. were acquired prior to September 30, 2016, the cumulative total return of these companies is not included in the totalshareholder return reflected for any of the three performance periods.

‰ The indicated annual dividend is $1.80 for fiscal 2017, which represents over a 7% increaseover fiscal 2016 and is the 29th consecutive year of annual dividend increases for theCompany.

Highlights of Executive Compensation Program

Objectives of Program

‰ Total direct compensation (base salary, annual incentive compensation and the value of long-term compensation granted) paid to named executive officers each year is designed to betargeted at the 50th percentile of competitive market practice, if performance targets arereached.

‰ Stock-based incentive plans and share ownership guidelines are utilized to align the interestsof our named executive officers with those of our shareholders.

‰ The use of perquisites and other personal benefits for named executive officers is limited.

No Significant Changes to Executive Compensation Program in Fiscal 2016

Our shareholders overwhelmingly approved the compensation of our named executive officers forfiscal 2015 at our 2016 annual meeting of shareholders, with about 96 percent of the shares voted infavor of such compensation. Accordingly, the Human Resources Committee (“HR Committee”) andour Board decided to not make any significant changes to our executive compensation programs andpolicies over the last fiscal year.

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Compensation of Chief Executive Officer

The Board awarded our Chief Executive Officer (“CEO”), Kim R. Cocklin, in addition to his basesalary of $1,004,138 paid during fiscal 2016, an amount of annual and long-term incentivecompensation for fiscal 2016 that was commensurate with our business results and pay-for-performance philosophy. Such compensation included an award under our Annual Incentive Plan forManagement (“Incentive Plan”) of $1,095,404 and long-term equity compensation awards under our1998 Long-Term Incentive Plan (“LTIP”), comprised of performance-based restricted stock units(“RSUs”) with a value of $1,241,413 and time-lapse RSUs with a value of $1,301,811 during fiscal2016. Consistent with our executive compensation philosophy, a majority of Mr. Cocklin’s total directcompensation of $4,642,766 for fiscal 2016 was incentive-based and at risk, as illustrated by thefollowing chart:

Base salary (21.6%)

Annual Incentive Planaward (23.6%)

Time-lapse RSUsaward value (28.1%)

Performance-based RSUsaward value (26.7%)

Compensation of Other Named Executive Officers

Consistent with its approach to the compensation of our CEO, the Board awarded each of ourother named executive officers an amount of annual and long-term incentive compensation for fiscal2016 that was also commensurate with our business results and pay-for-performance executivecompensation philosophy. A significant portion of each of their amounts of total direct compensationfor fiscal 2016 was also incentive-based and at risk, as shown on the following table and as illustratedby the chart below, in which the components of their average total direct compensation is presented:

Name and Principal Position Base SalaryAnnual Incentive

Plan Award

Performance-Based

RestrictedStock Units

Award Value

Time-LapseRestricted

Stock UnitsAward Value

Total DirectCompensation

Michael E. HaefnerPresident and Chief Operating Officer

$537,625 $488,741 $555,262 $634,590 $2,216,218

Bret J. EckertSenior Vice President andChief Financial Officer

$452,082 $328,781 $313,026 $313,026 $1,406,915

Louis P. GregorySenior Vice President, General Counseland Corporate Secretary

$398,877 $265,914 $217,533 $276,221 $1,158,545

Marvin L. SweetinSenior Vice President,Safety and Enterprise Services

$382,416 $254,940 $217,533 $273,816 $1,128,705

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Base salary (30.0%)

Annual Incentive Planaward (22.6%)

Time-lapse RSUsaward value (25.3%)

Performance-based RSUs award value (22.1%)

Proposals to be voted on by our Shareholders

Proposal One—Election of Directors

You will find in this proxy statement important information about the qualifications, skills andexperience of each of the 13 director nominees that you are being asked to elect at our annual meetingof shareholders. Our Nominating and Corporate Governance Committee (“Nominating and CGCommittee”) performs an annual assessment of the performance of each member of the Board ofDirectors to ensure that our directors have the qualifications, skills and experience to continue to serveeffectively. The committee has determined that all 13 director nominees possess the qualifications,skills, experience and other qualities important to the continued success of the Company. Accordingly,our Board recommends that our shareholders vote in favor of each nominee for re-election.

Proposal Two—Ratification of Appointment of our Independent Registered Public Accounting Firm

You will also find in this proxy statement important information about our independent registeredpublic accounting firm, Ernst & Young. We believe Ernst & Young continues to provide high qualityprofessional services to the Company. Our Board of Directors recommends that shareholders vote infavor of ratification of the firm’s appointment by the Audit Committee for fiscal 2017.

Proposal Three—Advisory Vote to Approve Executive Compensation (“Say-on-Pay”)

Our shareholders again have the opportunity to cast a non-binding, advisory vote to approve thecompensation of our named executive officers for fiscal 2016. Since it was first recommended by ourBoard and overwhelmingly approved by our shareholders at our 2011 annual meeting and again at our2016 annual meeting, we have provided our shareholders with an annual opportunity to vote on ourexecutive compensation. We were pleased that at last year’s annual meeting, about 96 percent of ourshareholders voted to approve the compensation of our named executive officers for fiscal 2015. Inevaluating this Say-on-Pay proposal, we recommend that you review our “Compensation Discussionand Analysis” in this proxy statement, which explains how and why the HR Committee and our Boardarrived at decisions concerning our fiscal 2016 executive compensation. Our Board of Directorsrecommends that our shareholders approve, on an advisory basis, the compensation of our namedexecutive officers for fiscal 2016.

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ATMOS ENERGY CORPORATIONP.O. Box 650205

Dallas, Texas 75265-0205

PROXY STATEMENTfor the

2017 ANNUAL MEETING OF SHAREHOLDERSto be Held on February 8, 2017

GENERAL MEETING MATTERS

Date, Time, Place and Purpose of Meeting

Our 2017 annual meeting of shareholders will be held on February 8, 2017, at 9:00 a.m. CentralStandard Time at the Charles K. Vaughan Center, 3697 Mapleshade Lane, Plano, Texas 75075. Thepurpose of the 2017 annual meeting is set forth in the Notice of Annual Meeting of Shareholders towhich this proxy statement is attached. Atmos Energy Corporation is referred to as “Atmos Energy,”the “Company,” “our,” “us” or “we” in this proxy statement.

Internet Availability of Proxy Materials

Under rules of the Securities and Exchange Commission (“SEC”), we are furnishing proxymaterials to our shareholders primarily over the Internet, rather than mailing paper copies of thematerials (including our Annual Report, which includes our Form 10-K for fiscal 2016) to eachshareholder. If you received only a Notice by mail or email, you will not receive a paper copy of theseproxy materials unless you request one. Instead, the Notice will instruct you as to how you may accessand review the proxy materials over the Internet. The Notice will also instruct you on how you mayaccess your proxy card to vote over the Internet. If you received a Notice by mail or email and wouldlike to receive a paper copy of our proxy materials, free of charge, please follow the instructionsincluded in the Notice.

We anticipate that the mailing of the Notice to our shareholders will commence on or aboutDecember 23, 2016 and will be sent by email to our shareholders who have opted for such means ofdelivery on or about December 27, 2016.

Revocability and Voting of Proxies

Any shareholder of record submitting a proxy has the power to revoke the proxy at any time priorto its exercise by (i) submitting a new proxy with a later date or time, including a proxy given over theInternet or by telephone; (ii) notifying our Corporate Secretary in writing before the meeting or(iii) voting in person at the meeting. Any shareholder owning shares in street name who wishes torevoke voting instructions previously given to a broker should contact such broker for furtherinstructions. Any shareholder who holds our shares as a participant in the RSP and who wishes torevoke voting instructions previously given to the RSP Trustee may submit new voting instructions byre-voting his or her proxy card or by written notice to the RSP Trustee on or before February 7, 2017 atthe following address: Atmos Energy Qualified Retirement Plans and Trusts Committee, Attn: PhillipAllbritten, Legal Dept., P.O. Box 650205, Dallas, TX 75265-0205.

An independent inspector of election will count the votes. Your vote will not be disclosed to usand will remain confidential except under special circumstances. For example, a copy of your proxy

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card will be sent to us if you add any written comments to the card. If you are a shareholder of recordand give us your signed proxy, but do not specify how to vote on any particular proposal, we will voteyour shares in favor of the nominees for the election of directors (see “Proposal One—Election ofDirectors,” beginning on page 16); in favor of the proposal to ratify the Audit Committee’sappointment of Ernst & Young as the independent registered public accounting firm for the Companyfor fiscal 2017 (see “Proposal Two—Ratification of Appointment of Independent Registered PublicAccounting Firm,” beginning on page 31); and in favor of the advisory proposal to approve executivecompensation for fiscal 2016 (see “Proposal Three—Non-Binding, Advisory Vote on Approval ofExecutive Compensation,” beginning on page 34).

Solicitation of Proxies

The proxy accompanying this statement is solicited by the management of the Company at thedirection of our Board of Directors. It is expected that these materials will be first sent to ourshareholders on or about December 23, 2016. We expect to solicit proxies primarily by mail, but ourdirectors, officers, employees and agents may also solicit proxies in person or by telephone or otherelectronic means. We will pay for all costs of preparing, assembling and distributing the proxies andaccompanying materials for the annual meeting of shareholders, including the costs of reimbursingbrokers for forwarding proxies and proxy materials to their principals. We will ask brokers to prepareand send a Notice to each of their customers or clients for whom they hold shares and forward copiesof the proxy materials to such beneficial owners who request a paper copy. In addition, Morrow Sodali,LLC, 470 West Avenue, Stamford, Connecticut 06902 (“Morrow Sodali”), will assist us in thesolicitation of proxies. We will pay approximately $7,500 in fees, plus expenses and disbursements, toMorrow Sodali for its proxy solicitation services.

Common Stock Information; Record Date

As of December 15, 2016, our record date, there were 105,094,734 shares of our common stock,no par value, issued and outstanding, all of which are entitled to vote. These shares constitute the onlyclass of our stock issued and outstanding. As stated in the Notice, only shareholders of record at theclose of business on December 15, 2016 will be entitled to vote at the meeting, with each share beingentitled to one vote.

Quorum Requirement

In accordance with Texas and Virginia law, our bylaws provide that if the holders of a majority ofthe issued and outstanding shares of our common stock entitled to vote are present in person orrepresented by proxy, there will be a quorum. The aggregate number of votes entitled to be cast by allshareholders present in person or represented by proxy at the annual meeting, whether thoseshareholders vote for, against or abstain from voting on any matter, will be counted for purposes ofdetermining whether a quorum exists. Broker non-votes, which are described below, will also beconsidered present for purposes of determining whether a quorum exists.

Broker Non-Votes and Vote Required

If a broker holds your shares and you have previously elected to receive a paper copy of yourproxy materials, a paper copy of this proxy statement and other proxy materials have been sent to yourbroker. You may have received this proxy statement directly from your broker, together with a votinginstruction form as to how to direct the broker to vote your shares. If you desire to have your vote

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counted, it is important that you return your voting instruction form to your broker. Rules of the NewYork Stock Exchange (“NYSE”) determine whether proposals presented at shareholder meetings areconsidered “routine” or “non-routine.” If a proposal is routine, a broker holding shares for an owner instreet name may vote on the proposal without having received voting instructions from the owner. If aproposal is non-routine, the broker may vote on the proposal only if the owner has provided votinginstructions. A “broker non-vote” occurs when the broker is unable to vote on a proposal because theproposal is non-routine and the owner does not provide instructions. Broker non-votes have no effecton the vote on such a proposal because they are not considered present and entitled to vote. ProposalsOne and Three are considered non-routine proposals; therefore, brokers may vote on these proposalsonly if voting instructions are provided by the owner of the shares. Only Proposal Two, the proposal toratify the appointment of Ernst & Young as the independent registered public accounting firm for theCompany for fiscal 2017, is considered a routine proposal under the rules of the NYSE. As a result,brokers holding shares for an owner in street name may vote on this proposal, even if no votinginstructions are provided by the owner of the shares.

Generally, in accordance with Texas and Virginia law, under our bylaws, the number of votesrequired for the approval of a proposal is a majority of the shares of our common stock present orrepresented by proxy and entitled to vote at the meeting. Abstentions will have the same effect as an“against” vote but, as discussed above, broker non-votes will have no effect on the vote for theseproposals. If any other proposals are properly presented to the shareholders at the meeting, the numberof votes required for approval will depend on the nature of the proposal. The proxy gives discretionaryauthority to the proxy holders to vote on any matter not included in this proxy statement that isproperly presented to the shareholders at the meeting. The persons named as proxies on the proxy cardare Robert W. Best, Chairman of the Board and Nancy K. Quinn, chair of the Audit Committee.

CORPORATE GOVERNANCE AND OTHER BOARD MATTERS

Corporate Governance

In accordance with, and pursuant to, the corporate governance standards of the NYSE, the Boardhas adopted and periodically updated our Corporate Governance Guidelines (“Guidelines”), whichgovern the structure and proceedings of the Board and contain the Board’s position on manygovernance issues. The Board has also adopted and periodically updated the Code of Conduct for ourdirectors, officers and other employees. The Code of Conduct provides guidance to the Board andmanagement in areas of ethical business conduct and risk, and provides guidance to employees anddirectors by helping them to recognize and deal with ethical issues including, but not limited to(i) conflicts of interest, (ii) gifts and entertainment, (iii) confidential information, (iv) fair dealing,(v) protection of corporate assets and (vi) compliance with rules and regulations. We have alsoprovided to our directors, officers, other employees, customers and any other member of the public atoll-free compliance hotline and a website by which they may report on an anonymous basis anyobservation of unethical behavior or any suspected violations of our Code of Conduct. In addition, theBoard has adopted and periodically updated the charters for its Audit Committee, HR Committee, andNominating and CG Committee. All of the foregoing documents are posted on the CorporateGovernance page under the Investors tab of our website at www.atmosenergy.com.

Independence of Directors

The Board is comprised of a majority of independent directors in accordance with NYSEcorporate governance standards. In accordance with rules of the SEC and the NYSE, as well as our

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Guidelines, to be considered independent, a director must not have a direct or indirect materialrelationship with the Company or its management, other than as a director. To assist it in making itsdetermination of the independence of each of its members, the Board has adopted its CategoricalStandards of Director Independence (“Standards”). The Standards specify the criteria by which theindependence of our directors will be determined and the types of relationships the Board hasdetermined to be categorically immaterial, including relationships of directors and their immediatefamilies with respect to past employment or affiliation with the Company, our management or ourindependent registered public accounting firm. For purposes of the Standards, the Board has adoptedthe definition of an “immediate family member” as set forth by the NYSE, which includes a director’sspouse, parents, children, siblings and in-laws, as well as anyone else (other than any domesticemployees) who shares such director’s home. The Standards and our Guidelines are posted on theCorporate Governance page of our website at www.atmosenergy.com.

Based on its review of the Standards, as well as applicable SEC rules and regulations, NYSEcorporate governance standards, and taking into consideration all business relationships between theCompany and each non-employee director and non-employee director nominee, the Board hasconcluded that none of such relationships are material, other than the relationship with Mr. Springerdescribed below. Accordingly, the Board has affirmatively determined that Ms. Compton, Ms. Quinn,Dr. Meredith and Messrs. Best, Douglas, Esquivel, Garza, Gordon, Grable, Sampson and Ware areindependent members of the Board. In addition, the Board has affirmatively determined that eachmember of the Audit Committee, HR Committee and Nominating and CG Committee are independentunder the Standards, as well as applicable SEC rules and regulations and NYSE corporate governancestandards.

In recommending to the Board that each non-employee director be found independent other thanMr. Springer, for the reasons described below, the Nominating and CG Committee reviewed andconsidered the following transactions, relationships or arrangements during the past three fiscal years,as discussed below. All matters described below fall within the Standards, including the monetarythresholds set forth in such Standards. Such matters are more fully discussed below under “RelatedPerson Transactions.”

‰ Mr. Ware is chairman and president of Amarillo National Bank in Amarillo, Texas, whichprovides a $25 million short-term line of credit to the Company and serves as a depositorybank for us; and

‰ Several of our other directors either are natural gas customers or are affiliated withbusinesses that are natural gas customers of the Company in the ordinary course of business,including Mr. Esquivel, who is affiliated with UT Southwestern Medical Center.

Because Mr. Springer’s son-in-law is a partner with the firm of Ernst & Young, our independentregistered public accounting firm, the Board has determined that Mr. Springer may not be consideredindependent from the Company under the Standards. However, Mr. Springer’s son-in-law is notinvolved in our audit and is not considered a “covered person” with respect to us, as defined under theSEC’s independence-related rules and regulations for auditors. Thus, this relationship has no effect onErnst & Young’s independence as our independent registered public accounting firm. Further,Mr. Springer does not serve on our Audit Committee, HR Committee or Nominating and CGCommittee.

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Related Person Transactions

In accordance with applicable SEC rules and in recognition that transactions into which we enterwith related persons may present potential or actual conflicts of interest, our Board has adopted andperiodically reviews written guidelines with respect to related person transactions. For purposes ofthese guidelines, a reportable “related person transaction” is a transaction between the Company andany “related person” (i) involving more than $120,000 when aggregated with all similar transactionsduring any fiscal year and (ii) where such “related person” has or will have a direct or indirect materialinterest in such transaction (other than solely as a result of being a director or a less than 10 percentbeneficial owner of another entity). A “related person” is any (a) person who is or was (since thebeginning of the last fiscal year) an executive officer, director or nominee for election as a director ofthe Company; (b) person who beneficially owns more than five percent (5%) of the Company’scommon stock or (c) immediate family member of any of the foregoing. An immediate family memberincludes a person’s spouse, parents, children, siblings, in-laws and anyone else (other than anydomestic employees) sharing such person’s home.

Under the guidelines, all named executive officers, directors and director nominees are required toidentify, to the best of their knowledge after reasonable inquiry, business and financial affiliationsinvolving themselves or their immediate family members, which could reasonably be expected to giverise to a related person transaction. Named executive officers, directors and director nominees arerequired to advise the Corporate Secretary of the Company promptly of any change in the informationprovided and are asked periodically to review and reaffirm this information.

The Nominating and CG Committee reviews the material facts of all related person transactionsand either approves or disapproves of the entry into any such transaction. However, if advancecommittee approval of a related person transaction is not feasible, then it shall be considered and, if thecommittee determines it to be appropriate, ratified at the committee’s next regularly scheduledmeeting. In determining whether to approve or ratify a related person transaction, the committee takesinto account, among other factors it deems appropriate, whether the related person transaction is onterms no less favorable than terms generally available to an unaffiliated third-party under the same orsimilar circumstances and the extent of the related person’s interest in the transaction.

No director is allowed to participate in any discussion or approval of a related person transactionfor which he or she is a related person, except that the director shall provide all material informationconcerning the transaction to the committee. If a related person transaction will be ongoing, thecommittee may establish guidelines for the Company’s management to follow in its ongoing dealingswith the related person. Thereafter, the committee, on at least an annual basis, will review and assessongoing relationships with the related person to see that they remain in compliance with theCompany’s related person transactions guidelines and that the related person transaction remainsappropriate. In addition, the committee will periodically review the related person transactionsguidelines to determine if changes or modifications may be appropriate.

The committee also makes a recommendation to the Board as to whether an identified transactionis required to be reported as a related person transaction under SEC rules. Under SEC rules, certaintransactions are deemed not to involve a material interest and thus are not reportable (includingtransactions in which the amount involved in any 12-month period is less than $120,000 andtransactions with entities where a related person’s interest is limited to service as a non-employeedirector). In determining materiality for this purpose, information is considered material if, in light ofall the facts and circumstances of the transaction, there is a substantial likelihood a reasonable investor

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would consider the information important in deciding whether to buy, sell or vote shares of theCompany’s common stock. The types of transactions specified below, which are pre-approved by thecommittee, are presumed not to involve a material interest.

‰ Transactions in the ordinary course of business with an entity for which a related person serves asan employee or director, provided the aggregate amount involved in any such transactions duringany particular fiscal year does not exceed the greater of (a) $1 million or (b) two percent (2%) ofthe entity’s gross revenues for the most recently completed fiscal year for which data is publiclyavailable;

‰ Charitable contributions made directly or indirectly, through a donor advised fund or foundation,in the ordinary course of business to a foundation, university or other charitable organization, forwhich a related person serves as an employee or a director, provided the aggregate amount ofcontributions during any particular fiscal year does not exceed the greater of (a) $500,000 or(b) two percent (2%) of the charitable organization’s annual receipts for its most recentlycompleted fiscal year;

‰ Employment by the Company of a family member of a named executive officer, provided thenamed executive officer does not participate in decisions regarding the hiring, performanceevaluation or compensation of the family member; and

‰ Payments under the Company’s employee benefit plans and other programs that are availablegenerally to the Company’s employees (including contributions under the Company’s educationalmatching gift programs and payments to providers under the Company’s health care plans).

The committee reviewed all business transactions during fiscal 2016 between the Company andcompanies for which related persons serve as employees or directors, including the transactionsdescribed below, which represent the only significant transactions of this type during fiscal 2016. Inaddition, as discussed above under “Independence of Directors,” the committee noted the relationshipwhich Mr. Springer has with our independent registered public accounting firm, Ernst & Young,through his son-in-law who is a partner with such firm. The total amount of fees paid to Ernst & Youngduring fiscal 2016 was $3,616,000, as more particularly described under “Audit and Related Fees,”beginning on page 31 below.

In addition, Mr. Springer has a son employed by ConocoPhillips in a non-officer capacity in itscommercial group. For fiscal 2016, the Company’s marketing and trading affiliate, Atmos EnergyMarketing, LLC (“AEM”), both purchased from and sold natural gas to ConocoPhillips for the benefitof AEM’s customers with the total amount of net purchases equal to about $616,000. All suchpurchases and sales with ConocoPhillips were made in the ordinary course of business and onsubstantially the same terms as other comparable transactions with third parties. The total amount oftransactions between AEM and ConocoPhillips during fiscal 2016 represents less than two percent(2%) of the gross revenues of ConocoPhillips for that period. Because these transactions withConocoPhillips fall within the types of transactions that have been pre-approved by the committee,such transactions are presumed to not involve a material interest.

Mr. Esquivel is Vice President for Community and Corporate Relations for UT SouthwesternMedical Center in Dallas, Texas (“UT Southwestern”). For fiscal 2016, the Company received totalrevenues from UT Southwestern of approximately $3,767,000. A total of approximately $2,777,000 inrevenues was received from UT Southwestern for natural gas purchased from AEM, with theremainder of approximately $990,000 in revenues being received for natural gas distribution

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and transportation services provided to UT Southwestern. All such services provided to UTSouthwestern, including the sales of natural gas by AEM, were made in the ordinary course of businessand on substantially the same terms as other comparable transactions with third parties. The committeehas received written confirmation from UT Southwestern that the total amount of revenues received bythe Company from UT Southwestern during fiscal 2016 represents less than two percent (2%) of thegross revenues of UT Southwestern for that period. Because these transactions with UT Southwesternfall within the types of transactions that have been pre-approved by the committee, such transactionsare presumed to not involve a material interest.

As noted above, in the discussion on the independence of our directors, Mr. Ware is Chairmanand President of Amarillo National Bank in Amarillo, Texas, which provides a $25 million short-termline of credit to the Company and serves as a depository bank for us. During fiscal 2016, we paid atotal of about $224,000 to Amarillo National Bank for these services, which amount is reasonable andcustomary for these types of services and such services are substantially on the same terms ascomparable transactions with third parties. The committee has received written confirmation fromAmarillo National Bank that such amount represents less than two percent (2%) of the gross revenuesof the Bank for the applicable period. Because these transactions with Amarillo National Bank fallwithin the types of transactions that have been pre-approved by the committee, such transactions arepresumed to not involve a material interest.

The Vanguard Group, Inc., BlackRock, Inc. and State Street are each the beneficial owners ofmore than five percent (5%) of the Company’s common stock outstanding (see “Beneficial Ownershipof Common Stock,” beginning on page 29). However, only State Street and its affiliates providedservices to the Company or our Master Retirement Trust (“Master Trust”) during fiscal 2016. For theCompany, State Street (i) acted as trustee of several benefits plans and trusts; (ii) provided fiduciaryservices for a benefits plan; and (iii) provided retiree benefit payment processing services for severalbenefits plans and trusts, for which the Company paid a total of approximately $167,000 in fees duringfiscal 2016. For the Master Trust, State Street (i) acted as trustee; (ii) provided fiduciary services for abenefits plan; (iii) provided retiree benefit processing services for a benefit plan whose assets are heldin the Master Trust; and (iv) provided investment management services relating to assets held in theMaster Trust. For such services, the Master Trust paid a total of approximately $329,000 in fees duringfiscal 2016. All such services provided to the Company and the Master Trust were made in theordinary course of business and on substantially the same terms as other comparable transactions withthird parties.

Finally, Mr. Best, our Chairman of the Board, has a son-in-law employed by the Company in anon-executive officer position. The total value of the family member’s compensation for fiscal 2016,including base salary, incentive compensation and equity awards appropriate for his position, exceedsthe SEC’s reporting threshold for disclosure of $120,000 per fiscal year. However, consistent with ourguidelines on related person transactions, the committee determined such relationship was not material.

The committee also reviewed all other transactions between the Company and other relatedpersons, and determined that the transactions described above represent the only significanttransactions of this type during fiscal 2016. In addition, the Company is not aware of any relatedperson transactions required to be reported under applicable SEC rules since the beginning of the lastfiscal year where our policies and procedures did not require review or where such policies andprocedures were not followed.

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Board Leadership Structure

The Company’s bylaws and Guidelines provide that our Board of Directors has the right toexercise its discretion to either separate or combine the offices of the Chairman of the Board and theCEO. This decision is based upon the Board’s determination of what is in the best interests of theCompany and its shareholders, in light of the circumstances and taking into consideration successionplanning, skills and experience of the individuals filling those positions and other relevant factors. Thecurrent leadership structure is based on the experienced leadership provided by a Chairman of theBoard (currently Mr. Best) and a full-time CEO (currently Mr. Cocklin), with both positions beingsubject to oversight and review by the Company’s independent directors. The Board recognizes that ifthe circumstances change in the future, other leadership structures might also be appropriate and it hasthe discretion to revisit this determination of the Company’s leadership structure. A combinedChairman and CEO Board leadership structure has previously worked well for the Company and itsshareholders and may do so in the future.

The Board’s leadership structure is designed so that independent directors exercise oversight ofthe Company’s management and key issues related to strategy and risk. Only independent directorsserve on our Audit Committee, HR Committee and Nominating and CG Committee of the Board, andall standing Board committees, other than the Executive Committee, are chaired by independentdirectors. Additionally, independent directors regularly hold executive sessions of the Board outsidethe presence of the Chairman, the CEO or any other Company employee, and they generally meet in aprivate session with the Chairman, the CEO and the President and Chief Operating Officer (“COO”) atregularly scheduled Board meetings.

Each year, the independent directors of the Board select an independent director to serve as a leaddirector (the “Lead Director”). The Lead Director performs the following duties: (i) presides at allmeetings of the Board at which the Chairman is not present; (ii) presides at all meetings of theindependent directors or non-management directors in executive sessions as may be necessary;(iii) coordinates and develops the agenda for executive sessions of the independent directors or non-management directors; (iv) approves meeting agendas for the Board; (v) approves Board meetingschedules to assure that there is sufficient time for discussion of all agenda items; (vi) acts as liaisonbetween the Chairman and the independent directors regarding business, management or other issues;(vii) approves information that is sent to the Board; (viii) discusses the results of the performanceevaluation of the CEO with the chair of the HR Committee; (ix) along with the chair of the HRCommittee, reports to the CEO the results of the performance evaluation and (x) identifies anddevelops with the Chairman and the CEO along with the chair of the Nominating and CG Committee,the Board’s compositional needs and criteria for the selection of candidates to serve as directors. Inperforming the duties described above, the Lead Director is expected to consult with the chairs of theappropriate Board committees and solicit their participation. The Lead Director also has the authorityto call meetings of the independent directors as well as the non-management directors; and if requestedby major shareholders, will ensure that he or she is available for consultation and directcommunication.

Our Board of Directors has the responsibility for risk oversight of the Company as a whole.However, the Board has delegated primary risk oversight responsibility to the Audit Committee. TheAudit Committee is responsible for overseeing risks associated with financial and accounting matters,including compliance with all legal and regulatory requirements and internal control over financialreporting. In addition, the Audit Committee has oversight responsibility for the Company’s overallbusiness risk management process, which includes the identification, assessment, mitigation and

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monitoring of key business risks on a company-wide basis. KPMG LLP (“KPMG”) which serves asthe Company’s internal auditor, presents a report to the Audit Committee at its regularly scheduledquarterly meetings on its internal audit activities. The report includes the audit activities performed theprevious quarter, which address the key business risks identified by the Audit Committee, includingevaluations and assessments of internal controls and procedures.

The Board has charged the HR Committee with ensuring that our executive compensation policiesand practices support the retention and development of executive talent with the experience required tomanage risks inherent to our business and do not encourage or reward excessive risk-taking by ourexecutives. See the discussion in “Compensation Risk Assessment,” beginning on page 49, for moreinformation on the specific processes used by the HR Committee to assess the risk profile of ourcompensation programs. The Nominating and CG Committee oversees risks associated with corporategovernance, including Board leadership structure, succession planning and other matters. The Board’srole in risk oversight has had no significant effect on the Board’s leadership structure. In addition, webelieve that the current leadership structure of the Board supports effective oversight of the Company’srisk management processes described above by providing independent leadership at the Boardcommittee level, with ultimate oversight by the full Board as led by the Chairman, the CEO and theLead Director.

Lead Director and Communications with Directors

In accordance with the corporate governance standards of the NYSE, the independent directors ofthe Board have designated Mr. Gordon as the Lead Director at all meetings of both independentdirectors and non-management directors, which meetings will continue to be held by the Board on aregular basis. Shareholders and other interested parties may communicate with the Lead Director,individual non-management directors, or the non-management directors as a group, by writing toBoard of Directors, Atmos Energy Corporation, P.O. Box 650205, Dallas, Texas, 75265-0205 or byemail at boardofdirectors@atmosenergy.com. Our Senior Vice President, General Counsel andCorporate Secretary, Louis P. Gregory, receives all such communications initially and forwards thecommunications to Mr. Gordon, as Lead Director, or another individual non-management director, ifapplicable, as he deems appropriate. Interested parties may also contact by email our directors who aremembers of management, Kim R. Cocklin, CEO at kim.cocklin@atmosenergy.com and Michael E.Haefner, President and COO at mike.haefner@atmosenergy.com. Messrs. Cocklin and Haefner mayalso be reached by mail at Atmos Energy Corporation, P.O. Box 650205, Dallas, Texas 75265-0205 orby telephone at 972-934-9227.

Committees of the Board of Directors

Executive Committee. This committee consists of the Chairman of the Board and the chairs ofeach of our standing committees. Current members of the Executive Committee are Ms. Quinn,Dr. Meredith and Messrs. Best, Gordon and Ware. Mr. Best serves as chair of the committee. Inaccordance with our bylaws, the Executive Committee has, and may exercise, all of the powers of theBoard of Directors during the intervals between the Board’s meetings, subject to certain limitations andrestrictions as set forth in the bylaws or as may be established by resolution of the Board from time totime. The Executive Committee held no meetings during fiscal 2016.

Audit Committee. The Board has established a separately-designated standing Audit Committeein accordance with applicable provisions of the Securities Exchange Act of 1934 (“Exchange Act”).

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The Audit Committee consists of Ms. Compton and Ms. Quinn, as well as Messrs. Esquivel, Garza,Grable, Sampson and Ware, with Ms. Quinn serving as chair of the committee. Ms. Compton wasappointed as a member of the Audit Committee at the time she was elected to the Board onNovember 1, 2016. As discussed in “Independence of Directors,” beginning on page 7, the Board hasdetermined that each member of the committee satisfies the independence requirements of the NYSEand SEC applicable to members of an audit committee. The Audit Committee oversees our accountingand financial reporting processes and procedures, reviews the scope and procedures of the internalaudit function, appoints our independent registered public accounting firm and is responsible for theoversight of its work and the review of the results of its independent audits. The Audit Committee heldfour meetings during the last fiscal year and has adopted a charter that it follows in conducting itsactivities, which is available on the Corporate Governance page of our website atwww.atmosenergy.com.

Human Resources Committee. This committee consists of Ms. Compton, Ms. Quinn, andDr. Meredith, as well as Messrs. Douglas, Esquivel, Gordon and Sampson, with Mr. Gordon serving aschair of the committee. Ms. Compton was appointed as a member of the Human Resources Committeeat the time she was elected to the Board on November 1, 2016. The Board has determined that eachmember of the committee satisfies the independence requirements of the NYSE and SEC. Thiscommittee reviews and makes recommendations to the Board regarding executive compensation policyand strategy, and specific compensation recommendations for the CEO, as well as our other officersand division presidents. This committee retained the consulting firm of Pay Governance LLC (“PayGovernance”) during fiscal 2016 to serve as its executive compensation consultant, which was directlyaccountable to the committee for the performance of its consulting services. In addition, the committeedetermines, develops and makes recommendations to the Board regarding severance agreements,succession planning and other related matters concerning our CEO, as well as other officers anddivision presidents. This committee also administers our LTIP and our Incentive Plan. During the lastfiscal year, the committee held four meetings. The committee has adopted a charter that it follows inconducting its activities, which is available on the Corporate Governance page of our website atwww.atmosenergy.com.

Nominating and Corporate Governance Committee. This committee consists of Dr. Meredithand Messrs. Douglas, Garza, Gordon, Grable and Ware, with Mr. Ware serving as chair of thecommittee. The Board has determined that each member of the committee satisfies the independencerequirements of the NYSE and SEC. This committee makes recommendations to the Board regardingthe nominees for director to be submitted to our shareholders for election at each annual meeting ofshareholders, selects candidates for consideration by the full Board to fill any vacancies on the Boardwhich may occur from time to time and oversees all of our corporate governance matters. Thecommittee held two meetings during the last fiscal year. The committee has adopted a charter that itfollows in conducting its activities, which is available on the Corporate Governance page of ourwebsite at www.atmosenergy.com.

Work Session/Annual Meeting Committee. This committee consists of Dr. Meredith and Messrs.Douglas, Grable, Springer and Ware, with Dr. Meredith serving as chair of the committee. Thiscommittee selects the site and plans the meeting and agenda for the work session meeting of the Boardheld each year for the purpose of focusing on long-range planning and corporate strategy issues andselects the site for the annual meeting of shareholders. During the last fiscal year, the committee heldtwo meetings.

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Independence of Audit Committee Members, Financial Literacy and Audit Committee FinancialExperts

In addition to being declared as independent under the NYSE corporate governance standards,applicable NYSE and SEC rules and regulations require that each member of an audit committeesatisfy additional independence and financial literacy requirements and at least one of these membersmust satisfy the additional requirement of having accounting or related financial managementexpertise. This additional requirement can be satisfied if the Board determines that at least one AuditCommittee member is an “audit committee financial expert,” within the meaning of applicable SECrules and regulations. Generally, the additional independence requirements provide that (i) a memberof the Audit Committee, or his or her immediate family members, are prohibited from receiving anydirect or indirect compensation or fee from the Company or its affiliates and (ii) he or she may not bean affiliated person of the Company or any of its subsidiaries. An “immediate family member” isdefined by applicable NYSE rules to include a director’s spouse, parents, children, siblings and in-lawsof the director, as well as anyone else (other than any domestic employee) who shares the director’shome.

Generally, the financial literacy requirements provide that the Board, in its business judgment,shall determine if each member is financially literate, taking into account factors such as the member’seducation, experience and ability to read and understand financial statements of public companies.Audit committee financial experts must have the following five additional attributes: (i) anunderstanding of generally accepted accounting principles and financial statements; (ii) the ability toassess the general application of such principles in connection with the accounting for estimates,accruals and reserves; (iii) experience preparing, auditing, analyzing or evaluating financial statementsthat present a breadth and level of complexity of accounting issues that are generally comparable to thebreadth and complexity of issues that can reasonably be expected to be raised by the Company’sfinancial statements, or experience actively supervising one or more persons engaged in such activities;(iv) an understanding of internal control over financial reporting and (v) an understanding of how anaudit committee functions.

Based on its review of the independence, financial literacy and audit committee financial expertrequirements previously discussed, as well as its review of their individual backgrounds andqualifications, the Board has determined that all members of the Audit Committee satisfy theadditional independence and financial literacy requirements of the SEC and NYSE for members of anaudit committee. The Board has also designated Ms. Quinn and Messrs. Garza, Sampson and Wareeach as an “audit committee financial expert,” as such term is defined by applicable rules andregulations of the SEC. As provided by the safe harbor contained in applicable SEC rules andregulations, our audit committee financial experts will not be deemed “experts” for any purpose as aresult of being so designated. In addition, such designation does not impose on such persons anyduties, obligations or liabilities that are greater than the duties, obligations and liabilities imposed onsuch persons as members of the Audit Committee or the Board in the absence of such designation. Thisdesignation also does not affect the duties, obligations or liabilities of any other member of the AuditCommittee or the Board.

Independence of Human Resources Committee Members

The Board has affirmatively determined that each member of the HR Committee has norelationship to the Company which is material to that director’s ability to be independent frommanagement of the Company in connection with the duties of an HR Committee member. In doing so,

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the Board considered all factors set forth in the NYSE corporate governance standards (and anyexceptions thereto) and any other relevant factor, including, but not limited to (i) the source of allcompensation paid by the Company to each member of the HR Committee during fiscal 2016,including any consulting, advisory, or other compensatory fees and (ii) whether each HR Committeemember is affiliated with the Company, a subsidiary of the Company or an affiliate of a subsidiary ofthe Company.

Other Board and Board Committee Matters

Human Resources Committee Interlocks and Insider Participation. As discussed above, themembers of the HR Committee during the last fiscal year were Ms. Quinn, Dr. Meredith and Messrs.Douglas, Esquivel, Gordon and Sampson. None of the HR Committee members were, during fiscal2016 or previously, an officer or employee of the Company or any of our subsidiaries. In addition,there was no interlocking relationship between any named executive officer of the Company and anyother corporation during fiscal 2016.

Attendance at Board Meetings and Annual Meeting of Shareholders. During fiscal 2016, ourBoard held nine meetings and each director attended at least 75 percent of the aggregate of (a) allmeetings of the Board and (b) all meetings of the committees of the Board on which such directorserved. In addition, all members of the Board attended our annual meeting of shareholders in person onFebruary 3, 2016. We strongly support and encourage each member of our Board to attend our annualmeeting of shareholders.

PROPOSAL ONE—ELECTION OF DIRECTORS

Background

The Board is nominating Ms. Compton and Ms. Quinn, as well as Messrs. Best, Cocklin,Douglas, Esquivel, Garza, Gordon, Grable, Haefner, Sampson, Springer and Ware to continue servingas directors whose one-year terms will expire in 2018. All nominees were recommended fornomination by the Nominating and CG Committee of the Board. Ms. Compton, who was first electedto the Board in November 2016, and Mr. Garza, who was first elected to the Board in March 2016,were both originally recommended to the Board by another director. We did not pay a fee to any thirdparty to identify, evaluate or assist in identifying or evaluating potential nominees for the Board. Inaddition, the Nominating and CG Committee did not receive any recommendations from a shareholderor a group of shareholders who, individually or in the aggregate, beneficially owned greater than fivepercent (5%) of our common stock for at least one year.

The names, ages, biographical summaries and qualifications of (i) the persons who have beennominated to serve as our directors are set forth under “Nominees for Director,” beginning on page 18and (ii) Dr. Meredith, who will be retiring from the Board at the conclusion of the annual meeting, isset forth under “Retiring Director,” on page 25. Each of the nominees has consented to be a nomineeand to serve as a director if elected. If we receive proxies that are signed but do not specify how tovote, we will vote those shares FOR all of the nominees. In accordance with Texas and Virginia law, tobe elected as a director, our bylaws require a nominee to receive the vote of a majority of the shares ofour common stock entitled to vote and represented in person or by proxy at a meeting of shareholdersat which a quorum is present. Abstentions will have the same effect as an “against” vote for eachnominee for director, but, as discussed above, broker non-votes will have no effect on the vote for anynominee.

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Procedures for Nomination of Candidates for Director

There are no differences in the manner in which the Nominating and CG Committee evaluatesnominees for director based on whether or not the nominee is presented by a shareholder. All directorcandidates shall, at a minimum, possess the qualifications for director discussed below. According toour bylaws, any shareholder may make nominations for the election of directors if notice of suchnominations is delivered to, or mailed and received by the Corporate Secretary of the Company at ourprincipal executive offices no later than the close of business on January 17, 2017, the 25th dayfollowing the day on which notice of the meeting is to be sent, December 23, 2016. Our principalexecutive offices are located at 1800 Three Lincoln Centre, 5430 LBJ Freeway, Dallas, Texas 75240.If no nominations are so made, only the nominations made by the Board of Directors may be votedupon at the 2017 annual meeting.

Each notice of a director nomination should include the following: (i) name, address and numberof shares owned by the nominating shareholder, (ii) the nominee’s name and address, (iii) a listing ofthe nominee’s background and qualifications, (iv) a description of all arrangements between suchshareholder and each nominee and any other person and (v) all other information relating to suchperson that is required to be disclosed in the solicitations for proxies for election of directors underapplicable SEC and NYSE rules and regulations. A signed statement from the nominee shouldaccompany the notice of nomination indicating that he or she consents to being considered as anominee and that, if nominated by the Board and elected by the shareholders, he or she will serve as adirector.

Qualifications for Directors

The Nominating and CG Committee uses a variety of methods to identify nominees for director,including considering potential director candidates who come to the committee’s attention throughcurrent officers, directors, professional search firms, shareholders or other persons. Nominees fordirector must possess, at a minimum, the level of education, experience, sophistication and expertiserequired to perform the duties of a member of the board of directors of a public company of our sizeand scope. Once a person is nominated, the committee will assess the qualifications of the nominee,including an evaluation of his or her judgment and skills. The Board has adopted guidelines outliningthe qualifications sought when considering non-employee director nominees, which are discussed inour Guidelines posted on the Corporate Governance page of our website at www.atmosenergy.com.

Based on the Guidelines, the specific qualifications and skills the Board seeks across itsmembership to achieve a balance of experiences important to the Company include, but are not limitedto, outstanding achievement in personal careers; prior board experience; wisdom, integrity and abilityto make independent, analytical inquiries; understanding of our business environment and awillingness to devote adequate time to Board duties. Other required specific qualifications and skillsinclude a basic understanding of principal operational and financial objectives, and plans and strategiesof a corporation or organization of our stature; results of operations and financial condition of anorganization and of any significant subsidiaries or business segments and a relative understanding ofan organization and its business segments in relation to its competitors.

The Board is committed to diversified membership and does not discriminate on the basis of race,color, national origin, gender, religion or disability in selecting nominees. Although the Board has notestablished a formal policy on diversity, the Board and the committee believe it is important that ourdirectors represent diverse viewpoints and backgrounds. Our Guidelines provide that the committee

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shall evaluate each director’s continued service on the Board, at least annually, by considering theappropriate skills and characteristics of members of the Board of Directors in the context of the thencurrent makeup of the Board. This assessment includes the following factors: diversity (includingdiversity of skills, background and experience); age; business or professional background; financialliteracy and expertise; availability and commitment; independence and other criteria that the committeeor the full Board finds to be relevant. It is also the practice of the committee to consider these factorswhen screening and evaluating candidates for nomination to the Board.

Nominees for Director

Each of the following current directors has been nominated to serve an additional one-year termon the Board of Directors with such term expiring in 2018.

Robert W. Best, Chairman of the Board of Atmos Energy since April 2013;formerly Executive Chairman of the Board of Atmos Energy from October 2010through March 2013 and Chairman of the Board and Chief Executive Officer ofAtmos Energy from October 2008 through September 2010; currently a directorof Associated Electric & Gas Insurance Services Limited. Mr. Best, 70, hasbeen a director of Atmos Energy since 1997.

Mr. Best led the senior management team of Atmos Energy from March 1997until his retirement as the Executive Chairman in April 2013. Prior to joiningAtmos Energy, Mr. Best had an extensive background in the natural gasindustry, especially in the interstate pipeline, gas marketing and gas distributionsegments of the industry, while serving in leadership roles at ConsolidatedNatural Gas Company, Transco Energy Company and Texas Gas TransmissionCorporation during his almost 40-year career. Mr. Best also has outside boardexperience as a member of the boards of the Maguire Energy Institute in theCox School of Business at Southern Methodist University, Associated Electric& Gas Insurance Services Limited and the Gas Technology Institute, withleadership experience as chairman of the boards of Atmos Energy, theAmerican Gas Association, the Southern Gas Association and the DallasRegional Chamber of Commerce. Mr. Best’s knowledge and expertise in theenergy industry and leadership abilities developed while with Atmos Energy,other energy companies and industry associations, as well as his demonstrationof those attributes discussed in the “Qualifications for Directors” section, hasled the Board to nominate Mr. Best to continue serving as a director ofAtmos Energy.

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Kim R. Cocklin, Chief Executive Officer of Atmos Energy since October 1,2015; formerly President and Chief Executive Officer of Atmos Energy fromOctober 2010 through September 2015 and President and Chief OperatingOfficer of Atmos Energy from October 2008 through September 2010.Mr. Cocklin, 65, has been a director of Atmos Energy since 2009.

Mr. Cocklin was promoted to Chief Executive Officer on October 1, 2015, afterhaving led Atmos Energy as President and Chief Executive Officer fromOctober 2010 through September 2015. Mr. Cocklin has served on theCompany’s senior management team since June 2006, having served asPresident and Chief Operating Officer from October 2008 through September2010, Senior Vice President, Regulated Operations from October 2006 throughSeptember 2008 and Senior Vice President from June 2006 through September2006. Mr. Cocklin has over 33 years of experience in the natural gas industry,most of that serving in senior management positions at Atmos Energy,Piedmont Natural Gas Company and The Williams Companies. Mr. Cocklin hasa strong background in the natural gas industry, including interstate pipelinecompanies, local distribution companies and gas treatment facilities. He also hasextensive experience in rates and regulatory matters, business development andSarbanes-Oxley compliance matters. In addition, Mr. Cocklin has heldleadership roles within leading natural gas industry associations, including theSouthern Gas Association and the American Gas Association. Due to hisprofessional experience in the energy industry and leadership roles with AtmosEnergy, other energy companies and industry associations, as well as possessingthose attributes discussed in the “Qualifications for Directors” section, theBoard has nominated Mr. Cocklin to continue serving as a director ofAtmos Energy.

Kelly H. Compton, Executive Director of The Hoglund Foundation in Dallas,Texas since 1992. Ms. Compton, 59, has been a director of Atmos Energy since2016.

Ms. Compton has been a philanthropic leader for over 24 years with TheHoglund Foundation, which partners with education and family supportagencies in Dallas, Texas. Prior to managing operations for The HoglundFoundation, Ms. Compton served as Vice President of Commercial Lending forNationsBank Texas and its predecessors for 13 years. Ms. Compton alsocurrently serves on the Board of Trustees for the Perot Museum of Nature andScience, the Board of Trustees for Southern Methodist University and the Boardof Directors for Momentous Institute. As a result of Ms. Compton’s leadershipabilities and experience in public and private finance, development and strategicmatters, in addition to displaying those attributes discussed in the“Qualifications for Directors” section, the Board has nominated Ms. Comptonto continue serving as a director of Atmos Energy.

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Richard W. Douglas, Executive Vice President of Jones Lang LaSalle LLC inDallas, Texas since July 2008. Mr. Douglas, 69, has been a director of AtmosEnergy since 2007.

Mr. Douglas has gained leadership experience with Jones Lang LaSalle LLC, aglobal real estate management and investment firm and developed business andstrategic planning expertise while at The Staubach Company, a nationallyrenowned real estate brokerage and services firm with internationalpartnerships. Mr. Douglas also possesses outside board experience on numerouscivic and nonprofit boards such as the United Way of Metropolitan Dallas andthe Greater Dallas Chamber of Commerce. As a result of Mr. Douglas’experience as a leader in commercial real estate and numerous non-profitcommunity organizations, his expertise in business and strategic planning, aswell as his exhibition of those attributes discussed in the “Qualifications forDirectors” section, the Board has nominated Mr. Douglas to continue serving asa director of Atmos Energy.

Ruben E. Esquivel, Vice President for Community and Corporate Relations ofUT Southwestern Medical Center in Dallas, Texas since December 1995.Mr. Esquivel, 73, has been a director of Atmos Energy since 2008.

Mr. Esquivel has led the community and corporate relations efforts forUT Southwestern, one of the nation’s leading academic medical and researchinstitutions, for over 20 years. During his previous 34-year career withAVO International, a manufacturer of test and measurement equipment forelectrical power applications, including his service for over nine years as ChiefExecutive Officer, Mr. Esquivel gained valuable leadership and managerialexperience. Mr. Esquivel also has served as a leader on the boards of publicly-held and non-profit organizations, including his past appointment as chairmanof the Texas Guaranteed Student Loan Corporation, and chairman of severalboards including the Dallas County Hospital District, North Texas Commissionand YMCA of Metropolitan Dallas. As a result of his business and leadershipexperience with AVO International, UT Southwestern and as well as leadershipexperience on the boards of other publicly-held and non-profit corporations, inaddition to displaying those attributes discussed in the “Qualifications forDirectors” section, the Board has nominated Mr. Esquivel to continue servingas a director of Atmos Energy.

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Rafael G. Garza, President and Founder of RGG Capital Partners, LLC inFt. Worth, Texas since 2000, and Co-Founder and Managing Director of BravoEquity, LP; currently a director of First Texas BHC, Inc., Southwest Bank,Vantage Bancorp and Vantage Bank Texas. Mr. Garza, 56, has been a directorof Atmos Energy since 2016.

For private investment company, Bravo Equity Partners, Mr. Garza has beenresponsible for managing various portfolio companies with a particular focus onU.S.-Hispanic market and Mexico. Prior to working with Bravo Equity Partners,Mr. Garza held numerous senior leadership positions with Ernst & Young’sAudit and Advisory and Corporate Finance divisions. Mr. Garza also has servedas a leader on the boards of several non-profit organizations, including TexasChristian University, the Modern Art Museum of Fort Worth and the Lena PopeHome. Mr. Garza’s in-depth experience with financial management andstrategic planning, his leadership abilities and his display of the attributesdiscussed in the “Qualifications for Directors” section have resulted in theBoard’s nomination of Mr. Garza to continue serving as a director ofAtmos Energy.

Richard K. Gordon, General Partner of Juniper Capital LP in Houston, Texassince March 2003, General Partner of Juniper Energy LP in Houston, Texassince August 2006, and co-founder of Juniper Capital II in Houston, Texas sinceSeptember 2014; currently a director of ExoStat Medical, Inc. Mr. Gordon, 67,has been a director of Atmos Energy since 2001.

For private equity funds Juniper Capital LP, Juniper Energy LP, and JuniperCapital II, Mr. Gordon has been responsible for managing various portfoliosthat collectively include power generation, mineral, oil and gas, natural gasgathering and oilfield services assets. Prior to working with Juniper Capital,Juniper Energy and Juniper Capital II. Mr. Gordon spent 29 years working withsuch financial services firms as Dillon, Read & Co., The First BostonCorporation and Merrill Lynch & Co. At such firms, Mr. Gordon wasresponsible for investment banking activities related to energy and powercompanies, including natural gas distribution companies. Based upon hisextensive business experience in investment banking and the energy industryand his in-depth leadership experience as the lead director and chair of the HRCommittee of Atmos Energy and as a member of the Board of ExoStat Medical,Inc., as well as possessing those attributes discussed in the “Qualifications forDirectors” section, the Board has nominated Mr. Gordon to continue serving asa director of Atmos Energy.

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Robert C. Grable, founding Partner, Kelly Hart & Hallman LLP in Fort Worth,Texas since April 1979. Mr. Grable, 70, has been a director of Atmos Energysince 2009.

Mr. Grable possesses advanced leadership skills developed as partner and oneof seven founders of Kelly Hart & Hallman LLP, a large regional law firm.Mr. Grable has extensive experience in representing companies in the oil andgas industry, having represented oil and gas producers, pipelines and utilities intransactions, regulatory matters and litigation, for over 40 years. Mr. Grable alsohas outside board experience as a Trustee of the University of Texas LawSchool Foundation and as an advisory board member for the local division of aglobal financial services firm. Mr. Grable is also a member of the McDonaldObservatory and Astronomy Board of Visitors at the University of Texas atAustin. As a result of his extensive legal experience with clients in the energyindustry and leadership experience with boards of for-profit and non-profitorganizations, as well as possessing those attributes discussed in the“Qualifications for Directors” section, the Board has nominated Mr. Grable tocontinue serving as a director of Atmos Energy.

Michael E. Haefner, President and Chief Operating Officer since October2015; formerly Executive Vice President from January 2015 through September2015 and Senior Vice President, Human Resources from June 2008 to January2015. Mr. Haefner, 56, has been a director of Atmos Energy since 2015.

Mr. Haefner was promoted to President and Chief Operating Officer in October2015 after advancing to the role of Executive Vice President in January 2015.Mr. Haefner has served on Atmos Energy’s senior management team since hejoined the Company as its Senior Vice President, Human Resources in June2008. Mr. Haefner served previously as Senior Vice President, HumanResources for Sabre Holdings Corporation. He has a 30-year work history withbroad experience in dynamic industries and over half of his career has been insenior management and critical leadership positions. Mr. Haefner’s innovativeinitiatives, continued strengthening of the Company’s culture and leadership aswell as his demonstration of those attributes discussed in the “Qualifications forDirectors” section, has led the Board to nominate Mr. Haefner to continueserving as a director of Atmos Energy.

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Nancy K. Quinn, independent energy consultant in Key Biscayne, Florida sinceJuly 1996; currently a director and chair of the audit committee of Helix EnergySolutions Group, Inc., a New York Stock Exchange company; formerly adirector and chair of the audit committee of Endeavour InternationalCorporation. Ms. Quinn, 63, has been a director of Atmos Energy since 2004.

Ms. Quinn provides senior financial and strategic advice, primarily to clients inthe energy and natural resources industries. Prior to 1996, Ms. Quinn held asenior advisory role with the Beacon Group, focusing on energy industry privateequity opportunities and merger and acquisition transactions. Ms. Quinn gainedextensive experience in independent exploration and production, as well as indiversified natural gas and oilfield service sectors, while holding leadershippositions at such firms as PaineWebber Incorporated and Kidder, Peabody &Co. Incorporated. Ms. Quinn has extensive corporate governance leadershipexperience as chair of the audit committee of Atmos Energy, and as a memberof the board and chair of the Audit Committee of Helix Energy SolutionsGroup. Ms. Quinn was also previously a member of the boards of EndeavourInternational, Louis Dreyfus Natural Gas Corp. and DeepTech International Inc.The Board has nominated Ms. Quinn, based upon her considerable experiencein the natural gas industry, her demonstrated leadership abilities as a boardleader in several public companies and her exhibition of those attributesdiscussed in the “Qualifications for Directors” section, to continue serving as adirector of Atmos Energy.

Richard A. Sampson, General Partner and Founder of RS Core Capital, LLC, aregistered investment advisory firm in Denver, Colorado since January 2013;formerly Managing Director and Client Adviser of JPMorgan Chase & Co. inNew York, San Francisco and Denver from May 2006 to May 2012.Mr. Sampson, 66, has been a director of Atmos Energy since 2012.

Mr. Sampson held numerous senior leadership positions with JPMorgan Chase,a global financial services firm, through which he gained extensive knowledgeof portfolio management, investment concepts, strategies and analyticalmethodologies. Mr. Sampson’s experience of over 29 years in investmentmanagement has provided him with an understanding of global and domesticmacroeconomics and capital market issues, financial markets, securities and asolid understanding of state and federal laws, regulations and policies. Inaddition to his display of the attributes discussed in the “Qualifications forDirectors” section, his substantial experience in investment management andhis knowledge of complex financial transactions, has led the Board to nominateMr. Sampson to continue to serve as a director of Atmos Energy.

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Stephen R. Springer, retired. Formerly Senior Vice President and GeneralManager, Midstream Division, The Williams Companies, Inc. Mr. Springer, 70,has been a director of Atmos Energy since 2005.

Mr. Springer’s professional career includes 32 years of experience in theregulated and nonregulated energy industry, while holding leadership roles atTexas Gas Transmission Corporation, Transco Energy Company and TheWilliams Companies. Mr. Springer’s knowledge of the natural gas industry isbased on his experience in the natural gas transmission, marketing, supply,transportation, business development, distribution and gathering and processingsegments of the industry. Mr. Springer has outside board experience as anhonorary director on the Indiana University Foundation Board and formerly onthe board of DCP Midstream Partners, LP, a New York Stock Exchangecompany. The Board has nominated Mr. Springer to continue serving as adirector of Atmos Energy in light of his considerable experience in the naturalgas industry, his leadership abilities developed while with The WilliamsCompanies and service on the boards of other public companies, and non-profitinstitutions, as well as his exhibition of those attributes discussed in the“Qualifications for Directors” section.

Richard Ware II, Chairman and President of Amarillo National Bank inAmarillo, Texas since May 2014; formerly President of Amarillo National Bankfrom January 1982 to May 2014. Mr. Ware, 70, has been a director of AtmosEnergy since 1994.

Mr. Ware has developed substantial knowledge of the financial servicesindustry during his 45-year career with a nationally recognized bankinginstitution. Mr. Ware has a strong background in assessing and overseeingcomplex financial matters, as well as leadership experience in supervisingprincipal financial officers and experience on the audit or finance committees ofAtmos Energy, Southwest Coca Cola Bottling Company and the board oftrustees of Southern Methodist University. Due to his valuable insight intofinancial-related matters gained through his extensive banking industryexperience and demonstrated leadership, particularly in his past and presentdirectorships, as well as his demonstration of those attributes discussed in the“Qualifications for Directors” section, the Board has nominated Mr. Ware tocontinue serving as a director of Atmos Energy.

The Board of Directors recommends that our shareholders vote FOReach of the nominees named above for election to the Board.

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Retiring Director

In accordance with the Guidelines of the Company concerning mandatory retirement of directors,Dr. Thomas C. Meredith will retire from the Board of Directors following the annual meeting ofshareholders on February 8, 2017.

Thomas C. Meredith, Ed.D, President, Effective Leadership LLC, a consultingfirm, in Oxford, Mississippi from April 2009 to present. Dr. Meredith, 75, hasbeen a director of Atmos Energy since 1995.

Dr. Meredith has exhibited excellent leadership skills over the past 19 yearsthrough his roles as an administrative and financial consultant to universityboards and presidents, the Commissioner of Mississippi Institutions of HigherLearning, Chancellor of the University System of Georgia, Chancellor of theUniversity of Alabama System, and President of Western Kentucky University.He also led an economic development task force for the State of Alabama,which led to the implementation of a major economic development plan for thatstate. Dr. Meredith is a recognized consultant in executive leadership and boarddevelopment matters and has experience in supervising executive levelaccounting staffs, which has added to his financial and macroeconomicknowledge and related skills.

DIRECTOR COMPENSATION

Annual Compensation

As compensation for serving as a director during fiscal 2016, each of our non-employee directorsreceived an annual retainer of $75,000, payable in advance on a quarterly basis. Mr. Best received anadditional annual fee of $125,000, payable in advance on a quarterly basis, for the additional serviceshe provided in connection with being the Chairman of the Board. In addition, our Lead Director,Mr. Gordon, received an additional annual fee of $25,000, also payable in advance on a quarterly basis,for additional services he provided in connection with being the Lead Director. As chair of the AuditCommittee, Ms. Quinn was paid an additional annual fee of $9,000 for additional services provided inconnection with her committee duties and responsibilities while the chairs of the remainder of theBoard committees were each paid an additional annual fee of $8,500 for such additional servicesprovided.

The Board of Directors makes the final determination, typically at its August meeting each year,on all non-employee director compensation, including without limitation, the annual retainer,additional annual fees for serving as Chairman, Lead Director and chairs of Board Committees, as wellas long-term equity compensation. The Board makes its determination based on recommendationsfrom the HR Committee, which is provided a report from its executive compensation consultant, PayGovernance, on competitive director compensation information, typically at its June meeting eachyear. The report includes a comprehensive review of director compensation programs of companies inthe Company’s proxy peer group. The HR Committee may not delegate to any third party its authorityto recommend non-employee director and executive officer compensation.

The Company also provides our non-employee directors the option to receive all or part of theirdirector fees (in 10 percent increments) in Atmos Energy common stock through the LTIP in order to

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increase the proprietary interest of our non-employee directors in the Company’s long-term prospectsand the strategic growth of our business. The common stock portion of the fee earned in each quarter isissued as soon as possible following the first business day of each quarter. The number of shares issuedis equal to the amount of the fee that would have been paid to the non-employee director during aquarter divided by the fair market value (average of the highest and lowest prices as reported on theNYSE Consolidated Tape) on the first business day of such quarter. Only whole numbers of shares ofcommon stock may be issued; fractional shares are paid in cash. Two of our directors elected thisoption during fiscal 2016.

With respect to other director compensation matters, all directors are reimbursed for reasonableexpenses incurred in connection with attendance at Board and committee meetings. A director who isalso an officer or employee receives no compensation for his or her service as a director. We providebusiness travel accident insurance for non-employee directors and their spouses. The policy provides$100,000 coverage to directors and $50,000 coverage to their spouses per accident while traveling onCompany business.

Long-Term Compensation

Each non-employee director is also eligible to participate in the Atmos Energy Corporation EquityIncentive and Deferred Compensation Plan for Non-Employee Directors (“Directors Plan”). This planallows each such director to defer receipt of his or her annual retainer fee or other director fees and toinvest such deferred fees in either a cash account or a stock account (in 10 percent increments). TheDirectors Plan is intended to encourage qualified individuals to accept nominations as directors of theCompany and to better align the interests between the non-employee directors and the Company’sshareholders.

The amount of the fee allocated as a credit to the cash account is converted to a cash balance as ofthe first business day of each quarter to be credited with interest at a rate equal to two and a halfpercent (2.5%) plus the annual yield reported on a 10-year U.S. Treasury Note for the first business dayof January for each plan year. Interest on the accumulated balance of the cash account is payablemonthly. The amount of the fee allocated as a credit to the stock account is converted to share units.The fee payable for the quarter is converted to a number of whole and, if applicable, fractional shareunits on the first business day of that quarter. Share units are also credited with dividend equivalentswhenever dividends are declared on shares of the Company’s common stock. Such dividend equivalentcredits are converted to whole and, if applicable, fractional share units on the same day on which suchdividends are paid. At the time of a participating director’s retirement, plan benefits paid from the cashaccount are paid in the form of cash. Plan benefits paid from the stock account are paid in the form ofshares of common stock issued, which are equal in number to whole share units in the director’s stockaccount. Any fractional share units are rounded up to a whole share unit prior to distribution. Eachnon-employee director also receives an annual grant of share units (currently 3,000 units) under theLTIP each year he or she serves on the Company’s Board of Directors. The grants generally occur onthe 30th day following the Company’s annual meeting of shareholders each year and are settled at thetime of the director’s retirement, in the same manner as share units under the Directors Plan.

Share Ownership Guidelines

To create more of a direct linkage with the financial performance of the Company and to furtheralign the interests of the members of the Board with those of our shareholders, the Board has adopted

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share ownership guidelines for our non-employee directors that are set forth in the Guidelines. Withinfive years of his or her initial election to the Board, each non-employee director is required to acquireownership of the Company’s common stock with a value equal to at least three times the amount ofsuch director’s annual retainer. Share ownership positions include all shares held directly or indirectlyby our non-employee directors as well as their share units held under our Directors Plan and the LTIP.All non-employee directors are in compliance with the Guidelines, except for Ms. Compton, who wasfirst elected to the Board in November 2016.

Summary of Cash and Other Compensation

The following table sets forth all compensation paid to our non-employee directors for fiscal2016:

Director Compensation for Fiscal Year 2016(a)

Name

Fees Earnedor Paid in Cash

($)(b)

StockAwards

($)(c)

Change inPension Value

andNonqualified

DeferredCompensation

Earnings($)(d)

All OtherCompensation

($)(e)Total

($)

Robert W. Best 200,000 210,330 — — 410,330

Richard W. Douglas 75,000 210,330 — — 285,330

Ruben E. Esquivel 75,000 210,330 6,390 8,267 299,987

Rafael G. Garza 43,750 210,330 — — 254,080

Richard K. Gordon 100,167 210,330 — — 310,497

Robert C. Grable 75,000 210,330 — — 285,330

Dr. Thomas C. Meredith 83,500 210,330 2,327 3,007 299,164

Nancy K. Quinn 96,500 210,330 3 4 306,837

Richard A. Sampson 75,000 210,330 — — 285,330

Stephen R. Springer 75,000 210,330 — — 285,330

Richard Ware II 83,500 210,330 — — 293,830

(a) No stock options were awarded to our directors and no non-equity incentive plan compensation was earned by our directors in fiscal2016.

(b) Non-employee directors may defer all or a part of their annual cash retainer under our Directors Plan. During fiscal 2016, Ms. Quinn andMr. Esquivel elected to defer a portion of their director fees (a total of $71,800), under such Plan, which amounts are included in thiscolumn and are described in the table below. Deferred amounts are invested, at the election of the participating director, either in a stockaccount or a cash account. Although Dr. Meredith did not participate in the deferred compensation feature of the Directors Plan in fiscal2016, interest has continued to be paid monthly on the accumulated balance of the cash account associated with his participation inprevious years. Also, Mr. Grable elected to forego the receipt in cash of a total of 30 percent of his director fees ($22,500) and insteadreceived shares of our common stock in fiscal 2016, while Mr. Ware elected to receive in lieu of cash a total of 70 percent of his directorfees ($58,450) in common stock. These shares do not contain any restrictions and were awarded on the first trading day of the quarter inwhich such fees were earned at the fair market value on that date. As a result of such elections, a total of 330 shares were issued toMr. Grable and 861 shares to Mr. Ware on the following dates and at the following fair market values during fiscal 2016: (i) October 1,2015, with a fair market value of $57.92 per share; (ii) January 4, 2016, with a fair market value of $62.53 per share; (iii) April 1, 2016,with a fair market value of $74.24 per share and (iv) July 1, 2016, with a fair market value of $80.85 per share. Fractional shares werepaid in cash.

(c) The amounts in this column represent the fair market value on the date of grant, calculated in accordance with FASB ASC Topic 718 ofthe 3,000 share units awarded to each of our non-employee directors under our LTIP for service on the Board in fiscal 2016 on March 4,2016 at a fair market value of $70.11 per share. The units granted must be held until retirement. As of the last day of fiscal 2016, no

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non-employee director held any stock options or unvested stock awards other than Mr. Best, who during his employment with theCompany as Executive Chairman, was awarded 11,309 time-lapse RSUs on November 5, 2013, which amount includes the 20 percentvalue premium received pursuant to his election under the Incentive Plan to convert incentive compensation paid for fiscal 2013 to time-lapse RSUs granted under our LTIP.

(d) The amounts in this column represent the amount of above-market interest earned during fiscal 2016 on the accumulated amount ofBoard fees deferred to cash accounts. Interest considered above-market is the incremental rate of interest earned above 120 percent of the10-year U.S. Treasury Note rate, which is reset on January 1 each year.

(e) The amounts in this column represent the market rate of interest accrued during fiscal 2016 on the accumulated amount of board feesdeferred to a cash account, including deferrals made to the cash account in 2016. No director received perquisites and other personalbenefits with an aggregate value equal to or exceeding $10,000 during fiscal 2016. All perquisites and other benefits were valued at theaggregate incremental cost to the Company.

Director Deferred Board Fees

The following table sets forth, for each participating non-employee director, the amount ofdirector compensation deferred during fiscal 2016 and cumulative deferred compensation as ofSeptember 30, 2016:

Director Deferred Board Fees for Fiscal Year 2016

Name

Board FeesDeferredto StockAccount

($)(a)

DividendEquivalentsEarned on

Stock Accountand

Reinvested($)(b)

CumulativeBoard FeesDeferred to

Stock Account atSeptember 30

($)

Board FeesDeferred to

Cash Account($)

InterestEarned on

Cash Account($)(c)

CumulativeBoard FeesDeferredto Cash

Account atSeptember 30

($)

Ruben E. Esquivel — — — 52,500 14,657 341,341

Dr. Thomas C. Meredith — 3,556 59,244 — 5,334 116,009

Nancy K. Quinn 19,300 7,835 188,296 — 7 152

(a) Ms. Quinn elected to receive 20 percent of her director fees in deferred stock for fiscal 2016. The $19,300 amount represents 290 shareunits received in fiscal 2016. Deferrals of amounts in the stock account are treated as though the deferred amounts are invested in ourcommon stock at the fair market value of the shares on the date earned. Shares of our common stock equal to the number of share units ina director’s stock account are issued to such director on the last day of the director’s service or a later date selected by the director.

(b) Dividend equivalents earned on the accumulated amount of share units in the stock account are reinvested in additional share units basedon the fair market value of the shares on the quarterly dividend payment dates. Such fair market values for fiscal 2016 were as follows:$61.92 on December 7, 2015; $70.48 on March 7, 2016; $74.60 on June 6, 2016 and $74.51 on September 6, 2016.

(c) The amounts in this column represent interest earned during fiscal 2016 on the accumulated amount of board fees deferred to the cashaccount, including deferrals made to the cash account in fiscal 2016, at a rate equal to the 10-year U.S. Treasury Note rate (2.245%) onthe first day of each plan year (January 1) plus 250 basis points.

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BENEFICIAL OWNERSHIP OF COMMON STOCK

Security Ownership of Certain Beneficial Owners

The following table lists the beneficial ownership with respect to each person known by us to bethe beneficial owner of more than five percent (5%) of any class of our voting securities as ofDecember 15, 2016:

Title of ClassName and Addressof Beneficial Owner

Amount andNature of

Beneficial OwnershipPercent (%)of Class(a)

Common stock The Vanguard Group, Inc.(b)100 Vanguard Blvd.Malvern, PA 19355

8,527,898 8.11

Common stock BlackRock, Inc.(c)55 East 52nd StreetNew York, NY 10055

7,017,857 6.68

Common stock State Street Corporation(d)State Street Financial CenterOne Lincoln StreetBoston, MA 02111

6,662,326 6.34

(a) The percent of voting securities is based on the number of outstanding shares of our common stock as of December 15, 2016.

(b) Based solely upon information contained in the most recently filed Schedule 13G/A, which was filed with the SEC on February 10,2016, in which The Vanguard Group Inc. (“Vanguard”) reported that as of December 31, 2015, it held all of its shares as an investmentadvisor in accordance with Rule 13d-1(b)(1)(ii)(E) of the Exchange Act and had sole voting power over 80,818 shares, shared votingpower over 4,900 shares, sole dispositive power over 8,456,380 shares and shared dispositive power over 71,518 shares. Based on theSchedule 13G/A, (i) Vanguard Fiduciary Trust Company, a wholly-owned subsidiary of Vanguard, is the beneficial owner of 66,618shares as a result of its serving as investment manager of collective trust accounts, and (ii) Vanguard Investments Australia, Ltd., awholly-owned subsidiary of Vanguard, is the beneficial owner of 19,100 shares as a result of its serving as investment manager ofAustralian investment offerings. Vanguard has not subsequently filed any Schedules 13G or amendments thereto with respect to itsbeneficial ownership of the Company’s common stock.

(c) Based solely upon information contained in the most recently filed Schedule 13G/A, which was filed with the SEC on January 25, 2016,in which BlackRock, Inc. reported that as of December 31, 2015, it held all of its shares as a parent holding company or control person inaccordance with Rule 13d-1(b)(1)(ii)(G) of the Exchange Act and had sole voting power over 6,586,281 shares and sole dispositivepower over all 7,017,857 shares. BlackRock, Inc. has not subsequently filed any Schedules 13G or amendments thereto with respect toits beneficial ownership of the Company’s common stock.

(d) Based solely upon information contained in the most recently filed Schedule 13G, which was filed with the SEC on February 12, 2016,in which State Street reported that as of December 31, 2015, it held all of its shares as a parent holding company or control person inaccordance with Rule 13d-1(b)(1)(ii)(G) of the Exchange Act and had shared voting and dispositive power with several of its affiliatesover all 6,662,326 shares. State Street has not subsequently filed any Schedules 13G or amendments thereto with respect to its beneficialownership of the Company’s common stock.

State Street is currently considered a related person under our related person transactionsguidelines as a result of being a beneficial owner of more than five percent (5%) of our common stockoutstanding. As discussed above under “Related Person Transactions,” beginning on page 9, StateStreet and its affiliates provide certain services to the Company and our Master Trust, includingproviding payment services for certain of our benefit plans, acting as trustee of our Master Trust andother benefits plans-related trusts, as well as providing investment management and paymentprocessing services. Although Vanguard and BlackRock, Inc. are also each considered a related personunder our related person transactions guidelines as a result of being a beneficial owner of more thanfive percent (5%) of our common stock outstanding, the Company engaged in no transactions witheither of these firms during fiscal 2016.

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Security Ownership of Management and Directors

The following table lists the beneficial ownership of our common stock, the only class ofsecurities issued and outstanding, with respect to all our directors and nominees for director, our chiefexecutive officer, chief financial officer and our three other most highly compensated executiveofficers (our “named executive officers”) and all our directors and executive officers as a group as ofDecember 15, 2016. Except as otherwise noted, the directors, nominees and executive officers,individually or as a group, have sole voting and investment power with respect to the shares listed.

Name of Beneficial Owner

Amount andNature ofBeneficial

Ownership(#)(a)Percent (%) of

Class(b)

Robert W. Best 637,856(c)Kim R. Cocklin 351,577(d)Kelly H. Compton -0-(c)Richard W. Douglas 36,451(c)Bret J. Eckert 28,791(d)Ruben E. Esquivel 28,101(c)Rafael G. Garza 3,071(c)Richard K. Gordon 55,912(c)Robert C. Grable 29,991(c)Louis P. Gregory 99,502(d)Michael E. Haefner 91,547(d)Dr. Thomas C. Meredith 59,289(c)Nancy K. Quinn 46,627(c)Richard A. Sampson 14,357(c)Stephen R. Springer 37,537(c)Marvin L. Sweetin 57,215(d)Richard Ware II 73,941(c)All directors, nominees and executive officers as a group(17 individuals)(b)(c)(d) 1,651,765 1.57

(a) These shares of our common stock are owned directly by each listed person, including shares held in our RSP, and by members of his orher household and are held individually, jointly or pursuant to a trust agreement, an IRA or other type of arrangement.

(b) The percentage of shares beneficially owned by any individual does not exceed one percent (1%) of the class so owned.

(c) Includes cumulative number of share units, with no voting rights, credited to the following directors under our Directors Plan and LTIPin the following respective amounts: Mr. Best, 12,828 units; Ms. Compton, -0- units; Mr. Douglas, 30,581 units; Mr. Esquivel,27,101 units; Mr. Garza, 3,071 units; Mr. Gordon, 45,912 units; Mr. Grable, 23,797 units; Dr. Meredith, 59,289 units; Ms. Quinn,44,627 units; Mr. Sampson, 12,857 units; Mr. Springer, 36,537 units and Mr. Ware, 57,393 units.

(d) Does not include unvested time-lapse restricted stock units in the following respective amounts: Mr. Cocklin, 75,773 units; Mr. Eckert14,590 units; Mr. Gregory, 27,640 units; Mr. Haefner, 31,131 units; and Mr. Sweetin, 26,919 units.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors, executive officers and persons whobeneficially own more than 10 percent of our common stock to file with the SEC initial reports ofownership and reports of changes in their ownership in our common stock. Directors, executiveofficers and greater-than-ten-percent beneficial shareholders are required by SEC regulations to furnishus with copies of all Section 16(a) forms they file. Based solely on a review of the copies of such

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reports furnished to us, we believe that, during fiscal 2016, all of our directors, executive officers andgreater-than-ten-percent beneficial owners were in compliance with the Section 16(a) filingrequirements.

PROPOSAL TWO—RATIFICATION OF APPOINTMENT OFINDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee of the Board has appointed Ernst & Young to continue as our independentregistered public accounting firm for the fiscal year ending September 30, 2017. The firm of Ernst &Young (and its predecessors) has been our independent registered public accounting firm since ourincorporation in 1983. It is expected that representatives of Ernst & Young will be present at the annualmeeting. The representatives of Ernst & Young will have the opportunity to make a statement if theydesire to do so and are expected to be available to respond to appropriate questions.

In accordance with good corporate governance practices, the Company submits the AuditCommittee’s appointment of Ernst & Young as its independent registered public accounting firm to ourshareholders for ratification each year. If the appointment of Ernst & Young is not so ratified, theAudit Committee will take into account the outcome of the vote in its future selection of anindependent registered public accounting firm.

As discussed in “Audit Committee Pre-Approval Policy” below, all professional servicesprovided by Ernst & Young were pre-approved by the Audit Committee in accordance with its pre-approval policy.

The Board of Directors recommends that our shareholders vote FOR theratification of the appointment of Ernst & Young as the Company’s

independent registered public accounting firm for fiscal 2017.

Audit and Related Fees

Fees for professional services provided by our independent registered public accounting firm,Ernst & Young, in each of the last two fiscal years, in each of the following categories are:

September 30

2016 2015

($ In thousands)

Audit Fees 3,578 3,399

Audit-Related Fees — —

Tax Fees 38 26

All Other Fees — —

Total Fees 3,616 3,425

Audit Fees. Fees for audit services include fees associated with the audit of our annual report onForm 10-K, the assessment by the firm of our design and operating effectiveness of internal controlover financial reporting and the reviews of our quarterly reports on Form 10-Q. In addition, thisamount includes fees associated with the issuance of consents and comfort letters relating to theregistration of Company securities and assistance with the review of documents filed with the SEC, aswell as fees for an audit provided in connection with a statutory filing.

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Tax Fees. Tax fees include fees relating to reviews of tax returns, tax consulting, and assistancewith sales and use tax filings and audits.

Audit Committee Pre-Approval Policy

The Audit Committee has adopted a pre-approval policy relating to the provision of both auditand non-audit services by Ernst & Young. Our Audit Committee Pre-Approval Policy provides for thepre-approval of audit, audit-related, tax and other services specifically described in appendices to thepolicy on an annual basis. Such services are pre-approved up to a specified fee limit. All otherpermitted services, as well as proposed services exceeding the pre-approved fee limit, must beseparately pre-approved by the Audit Committee. Requests for services that require separate approvalby the Audit Committee must be submitted to the Audit Committee by both our Chief Financial Officerand our independent registered public accounting firm and must include a joint statement as towhether, in their view, the request is consistent with the SEC’s rules on auditor independence. Thepolicy authorizes the Audit Committee to delegate to one or more of its members pre-approvalauthority with respect to permitted services. The Audit Committee did not delegate pre-approvalauthority to any members during fiscal 2016 and pre-approved all audit and tax fees for servicesperformed by Ernst & Young in fiscal 2016 in accordance with such pre-approval policy. The AuditCommittee further concluded that the provision of these services by Ernst & Young was compatiblewith maintaining its independence. The Audit Committee Pre-Approval Policy is available on theCorporate Governance page of our website at www.atmosenergy.com.

Audit Committee Report

The Audit Committee of the Board of Directors is composed of seven directors who areindependent directors as required by and in compliance with all applicable listing standards of theNYSE as well as all applicable rules and regulations of the SEC, as discussed in the “CorporateGovernance and Other Board Matters” section of this proxy statement, beginning on page 7. TheAudit Committee acts under a written charter adopted by the Board of Directors, which sets forth itsdetailed responsibilities and duties, as well as requirements for the Audit Committee’s composition andmeetings. A copy of the charter is available on the Corporate Governance page of the Company’swebsite at www.atmosenergy.com.

The primary purpose of the Audit Committee is to oversee the Company’s financial reportingprocess on behalf of the Board of Directors. Management has the primary responsibility for thefinancial statements and the financial reporting processes of the Company, including systems ofinternal control over financial reporting and disclosure controls and procedures. Ernst & Young isresponsible for (i) expressing an opinion, based on its audit, as to the conformity of the auditedfinancial statements with generally accepted accounting principles and (ii) expressing an opinion,based on its audit, on the effectiveness of the Company’s internal control over financial reporting.

In fulfilling its oversight responsibilities, the Audit Committee reviewed and discussed the auditedfinancial statements appearing in the Company’s 2016 Annual Report on Form 10-K with bothmanagement and Ernst & Young, which included a discussion of the critical accounting policies andpractices used by the Company, and alternative treatments of financial information within generallyaccepted accounting principles, if any, and their effects, including the treatments preferred by theindependent registered public accounting firm, if applicable. In addition, the Committee reviewed allother material communications between the Company and Ernst & Young.

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Management has represented to the Audit Committee that the Company’s internal control overfinancial reporting is effective. The Audit Committee then reviewed and discussed management’sassessment with management and Ernst & Young. The Audit Committee also discussed with Ernst &Young its report on the Company’s internal control over financial reporting as well as the mattersrequired to be discussed under generally accepted auditing standards, including those matters set forthin Auditing Standard No. 16, Communications with Audit Committees, as adopted by the PublicCompany Accounting Oversight Board (“PCAOB”).

In addition, the Audit Committee has received and reviewed the written disclosures and letterfrom Ernst & Young, which are required by applicable requirements of the PCAOB regarding theindependent registered public accounting firm’s communications with the Audit Committee concerningindependence and discussed with Ernst & Young the firm’s independence. The Audit Committee alsoreceived and reviewed those disclosures related to the independence of the Company’s independentregistered public accounting firm required by the provisions of the Sarbanes-Oxley Act of 2002 andrelated rules and regulations of the SEC. The Audit Committee has also considered the fees paid toErnst & Young during the last fiscal year for audit and non-audit services and has determined that thenon-audit services provided are compatible with the firm’s independence and are in compliance withapplicable law.

The Audit Committee has also discussed with KPMG, which provides internal audit services tothe Company, and Ernst & Young, the overall scope and plans for their respective audits. TheCommittee periodically meets with both firms, with and without management present, to discuss theresults of their examinations, the assessments of the Company’s internal control over financialreporting and the overall quality of the Company’s financial reporting.

In reliance on the reviews and discussions referred to above, the Audit Committee recommendedto the Board of Directors (which the Board has approved) that the Company’s audited financialstatements be included in its Annual Report on Form 10-K for the year ended September 30, 2016 forfiling with the SEC. The Audit Committee has also appointed Ernst & Young as the Company’sindependent registered public accounting firm for the 2017 fiscal year, which appointment will besubmitted to our shareholders for their ratification at our 2017 annual meeting of shareholders.

Respectfully submitted by the members of the Audit Committee of the Board of Directors:

Nancy K. Quinn, ChairKelly H. ComptonRuben E. EsquivelRafael G. GarzaRobert C. GrableRichard A. SampsonRichard Ware II

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PROPOSAL THREE—NON-BINDING, ADVISORY VOTEON APPROVAL OF EXECUTIVE COMPENSATION

Background of the Proposal

We are required by Section 14A of the Exchange Act to hold a separate non-binding, advisoryshareholder vote to approve the compensation of our named executive officers (who are the onlyexecutive officers of the Company), as described in the “Compensation Discussion and Analysis,”beginning on page 36 the executive compensation tables, and the notes and narrative in our proxystatement (commonly referred to as the “Say-on-Pay” proposal). At our annual meeting of shareholdersin February 2016, our shareholders voted overwhelmingly to adopt the recommendation of our Boardto vote on the Say-on-Pay proposal every year at our annual meeting until the next frequency vote onthe Say-on-Pay proposal is held. In accordance with the results of this latest vote, the Board ofDirectors determined to continue its practice of providing to our shareholders an annual advisory voteon executive compensation, which it began following the first time our shareholders votedoverwhelmingly at our annual meeting in February 2011 to adopt the recommendation of our Board tovote on the Say-on-Pay proposal each year. As a result, we will have submitted our Say-on-Payproposal to our shareholders at each annual meeting beginning in February 2011 through the upcomingannual meeting in February 2017. It is anticipated that the next Say-on-Pay vote will be held at our2018 annual meeting.

Executive Compensation

As discussed below in the “Compensation Discussion and Analysis” section of this proxy statement,the Board believes that our current executive compensation program directly links executivecompensation to our financial performance and aligns the interests of our named executive officers withthose of our shareholders and customers. Our Board also believes that our executive compensationprogram provides our named executive officers with a balanced compensation package that includes areasonable base salary along with annual and long-term incentive compensation plans that are based onthe Company’s financial performance. As discussed below in “Elements of Executive Compensation,”beginning on page 39, for fiscal 2016, over 50 percent of our CEO’s actual total direct compensation wasperformance-based and at risk, while the average for the other named executive officers was about 45percent. Our shareholders overwhelmingly approved our executive compensation program when theyapproved the executive compensation of our named executive officers at our last annual meeting with apositive vote of about 96 percent. See “Additional Information on Named Executive OfficerCompensation,” beginning on page 45.

The HR Committee annually reviews the Company’s overall approach to executive compensationto see that the Company’s current benefits, perquisites, policies and practices continue to be in linewith the best practices of companies in the natural gas distribution industry and to assist us with thehiring and retention of a high-quality management team. The “Compensation Discussion andAnalysis” discussion, beginning on page 36, includes additional details about our executivecompensation program. This Say-on-Pay proposal is set forth in the following resolution:

RESOLVED, that the shareholders of Atmos Energy Corporation approve, on anadvisory basis, the compensation of its named executive officers for fiscal 2016, as disclosedin the Company’s Proxy Statement for the 2017 Annual Meeting of Shareholders, pursuant tothe compensation disclosure rules of the Securities and Exchange Commission, including theCompensation Discussion and Analysis, the related compensation tables, notes and narrativein the proxy statement of Atmos Energy Corporation.

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Because your vote on this proposal is advisory, it will not be binding on the Board or theCompany. However, the HR Committee and the Board of Directors will take into account the outcomeof the vote when considering future executive compensation arrangements.

The Board of Directors recommends that our shareholders vote FORthe approval of our executive compensation on an advisory basis.

Human Resources Committee Report

The Human Resources Committee of the Board of Directors has the responsibility for reviewingand recommending to the full Board of Directors, the Company’s executive compensation program.The committee is composed entirely of persons who qualify as independent directors under the listingstandards of the NYSE. In this context, the committee has met, reviewed and discussed withmanagement the “Compensation Discussion and Analysis” contained in this proxy statement. Based onthis review and discussion, the committee recommended to the Board of Directors, and the Board ofDirectors approved, the inclusion of the “Compensation Discussion and Analysis” in this proxystatement.

Respectfully submitted by the members of the Human Resources Committee of the Board ofDirectors:

Richard K. Gordon, ChairKelly H. ComptonRichard W. DouglasRuben E. EsquivelThomas C. MeredithNancy K. QuinnRichard A. Sampson

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COMPENSATION DISCUSSION AND ANALYSIS

Executive Summary

In this section of the proxy statement, we discuss our executive compensation program objectivesand strategy, and the elements of compensation that we provide to our named executive officers,including the analysis we employed in reaching the decisions to pay the specific amounts and types ofexecutive compensation discussed. Later, under “Named Executive Officer Compensation,” beginningon page 51, we present a series of tables containing specific information about the compensation paidto or earned by our named executive officers during fiscal 2016, as well as more information about theelements of our executive officer compensation program. The discussion below is intended to assistyou in understanding the information provided in the tables and in putting that information intocontext. Our named executive officers for fiscal 2016 are listed below:

Name Title

Kim R. Cocklin Chief Executive OfficerMichael E. Haefner President and Chief Operating OfficerBret J. Eckert Senior Vice President and Chief Financial OfficerLouis P. Gregory Senior Vice President, General Counsel and Corporate SecretaryMarvin L. Sweetin Senior Vice President, Safety and Enterprise Services

Our executive compensation program is built upon our strategy of “Total Rewards,” which weadopted in 1998. Under our Total Rewards strategy, we take a comprehensive view of the variouscompensation plans and employee benefits that comprise the total package of executive compensationthat is provided to our named executive officers. The Total Rewards strategy is based on the paymentof (i) total cash compensation, composed of base salary and the annual incentive compensation awardand (ii) total direct compensation, composed of total cash compensation and the annualized presentvalue of long-term incentive compensation awards, being targeted at the 50th percentile of all suchcompensation for equivalent positions at companies of comparable size in the natural gas distributionindustry, which is represented primarily by companies in our proxy peer group, as discussed belowunder “Competitive Executive Compensation Benchmarking,” beginning on page 45. We believe thisstrategy fosters a philosophy of “pay for executive performance” through the use of both annual andlong-term incentive compensation.

Overview of Fiscal 2016 Financial Performance. In recent years, Atmos Energy hasimplemented rate designs that reduce or eliminate regulatory lag and separate the recovery of ourapproved rate from customer usage patterns. Additionally, we have significantly increased investmentsin the safety and reliability of our natural gas distribution and transmission infrastructure. Thisincreased level of investment and timely recovery of these investments through our various regulatorymechanisms has resulted in increased earnings and operating cash flow in recent years.

This trend continued during fiscal 2016 as net income increased to $350.1 million, or $3.38 perdiluted share for the year ended September 30, 2016, compared with net income of $315.1 million or$3.09 per diluted share in the prior year. The year-over-year increase largely reflects positive rateoutcomes, which more than offset weather that was 25 percent warmer than the prior year andincreased pipeline maintenance and integrity spending.

Capital expenditures for fiscal 2016 totaled almost $1.1 billion. Over 80 percent of this amountwas invested to improve the safety and reliability of our distribution and transmission systems, with a

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significant portion of this investment incurred under regulatory mechanisms that reduce regulatory lagto six months or less. Fiscal 2015 spending under these and other mechanisms enabled the Company tocomplete 20 regulatory filings during fiscal 2016 that should increase annual operating income fromregulated operations by $122.5 million.

Overview of Annual Incentive Compensation Paid for Fiscal 2016 Financial Performance. TheCompany exceeded its target EPS goal under the Incentive Plan of $3.30 per diluted share in fiscal2016, by earning $3.37 per diluted share, excluding unrealized earnings recognized by the Company’snonregulated operations. This performance attainment resulted in the named executive officersreceiving awards equal to 121 percent of their respective target awards (as a specified percentage ofbase salary). See “Annual Incentive Compensation,” beginning on page 40.

Overview of Long-Term Incentive Compensation Paid for Fiscal 2014-2016 FinancialPerformance. The Company achieved a cumulative diluted EPS amount of $9.37, excluding unrealizedearnings recognized by the Company’s nonregulated operations, compared to the cumulative diluted EPStarget amount of $8.71 during the three-year performance period ended September 30, 2016 (fiscal 2014-2016), for the grants of performance-based RSUs awarded in May 2014. The named executive officersearned a total number of performance-based RSUs equal to 176 percent of the target, in the form ofshares of common stock issued in November 2016, plus cumulative dividend equivalents in the form ofcash. See “Long-Term Incentive Compensation,” beginning on page 42.

Our Total Rewards strategy, in which we limit the use of executive benefits and perquisites, isreviewed each year and updated as needed by our HR Committee, with assistance from its independentexecutive compensation consultant, Pay Governance. None of our named executive officers have anemployment agreement with the Company. We believe that our executive compensation programprovides our named executive officers with a balanced compensation approach each year by providinga market-competitive base salary along with participation in annual and long-term incentivecompensation plans that are based on the Company’s financial performance. These incentive plans aredesigned to reward our named executive officers on both an annual and long-term basis if they attainspecified target goals, the attainment of which does not require the taking of an unreasonable amountof risk, as discussed in “Compensation Risk Assessment,” beginning on page 49.

In addition, our executive compensation program has been designed to reflect best practices,including the following specific features:

‰ no employment agreements with our officers;

‰ limited perquisites, such as financial planning;

‰ payment of dividend equivalents on performance-based equity awards only at the end of theperformance period when vesting is completed and then only if performance targets are met atthat time;

‰ clawback policy that provides for the repayment or forfeiture of all incentive-based compensation,which is earned due to restatement of financial statements and other circumstances;

‰ tiered stock ownership requirements for officers, named executive officers and directors;

‰ no hedging of our securities allowed by our employees, officers or directors at any time;

‰ no pledging of our securities allowed by our named executive officers or directors at any time;

‰ no immediate vesting of outstanding grants of awards under our LTIP upon a change in control;and

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‰ change in control payments that:

(a) do not exceed three times the sum of a named executive officer’s base salary and his mostrecent annual award of incentive compensation;

(b) are triggered only by an involuntary job loss or substantial diminution of duties (“doubletriggers”); and

(c) do not contain excise tax gross-up payments.

Executive Compensation Program Objectives and Strategy

Our executive compensation program is designed to ensure that the interests of our namedexecutive officers are closely aligned with those of our shareholders and customers and that our namedexecutive officers are paid an appropriate amount of incentive compensation only when the Company’sperformance warrants the payment of such compensation. We believe that our executive compensationprogram is effective in allowing the organization to attract and retain highly-qualified seniormanagement who can deliver outstanding performance.

As discussed above, our executive compensation program is built on our Total Rewards strategyand is founded upon the following principles:

‰ Our compensation strategy should be aligned with our overall business strategy of providing safe,quality and reliable service to our customers, seeking ongoing improvements in operatingefficiencies and focusing upon growth opportunities;

‰ Overall pay targets should reflect the intent to pay named executive officer base salaries at the50th percentile of the competitive market practice with targeted total cash compensation (basesalary plus annual incentive award) and targeted total direct compensation (total cashcompensation plus annualized present value of grants of long-term equity incentivecompensation) to be paid at the 50th percentile of competitive market practice, if establishedperformance targets are reached;

‰ Key executives charged with the responsibility for establishing and executing business strategyshould have incentive compensation opportunities that are aligned with the creation of shareholdervalue and include upside potential with commensurate downside risk;

‰ Incentive compensation plans, to the extent practical and consistent with our overall corporatebusiness strategy, should comply with Section 162(m) of the Internal Revenue Code of 1986, asamended (the “Code”), so that income tax deductions for executive compensation may possiblybe taken by the Company;

‰ Stock ownership, which is an important component of our executive compensation strategy,should closely align the interests of our named executive officers with those of our shareholders.To facilitate stock ownership, stock-based incentive plans should be utilized, along with shareownership guidelines; and

‰ Our executive compensation strategy should have a limited emphasis upon perquisites and otherpersonal benefits.

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Elements of Executive Compensation

The following table summarizes the various elements of executive compensation that we haveprovided to our named executive officers, followed by a more detailed discussion of each element, whywe pay each element, how we determine the amount we pay under each element and how each elementfits into our overall compensation objectives.

Element DescriptionObjective within

Compensation Program

Base Salary Fixed compensation, subject to annualreview and adjusted in response tochanges in performance, duties,strategic importance or competitivesalary practices

‰Reflects roles, responsibilities,skills, experience and performance

‰Provides base compensation at alevel consistent with salarycompetitive practices

AnnualIncentiveCompensation

Annual cash performance award basedon achievement of Company financialperformance measures

‰Motivates and rewards achievementof annual Company goals

‰Increases alignment of seniormanagement and shareholders’interests by linking pay andperformance

‰Promotes achievement of annualfinancial goals by linking pay toattainment of such goals

Long-TermIncentiveCompensation

Performance-based awards payableonly if performance goals are achievedduring a three-fiscal year performanceperiod. Time-lapse awards alsopayable, with cliff vesting, at the end ofthree-fiscal year period.

‰Motivates and rewards financialperformance over a sustained period

‰Increases alignment of seniormanagement and shareholders’interests by encouraging shareownership of senior management

‰Enhances retention of seniormanagement

‰Rewards strong total shareholderreturn and earnings growth

RetirementBenefits

Tax-qualified retirement benefits,supplemental retirement and otherbenefits

‰Provides for current and futureneeds of senior management

‰Enhances recruitment and retention

‰Follows competitive marketpractices

Change inControlSeveranceBenefits

Change in control severanceagreements: contingent amountspayable only if employment isterminated under certain conditionsfollowing change in control

‰Enhances retention of seniormanagement by providingcontinuity of employment

‰Promotes objective evaluation andexecution of potential changes to theCompany’s strategy and structure

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Base Salary. The payment of a base salary is intended to provide a stable, fixed amount ofincome to our named executive officers for their day-to-day job performance. Base salaries representonly a relatively small portion of total direct compensation. In fiscal 2016, the base salary for our CEOrepresented only about 22 percent of his actual total direct compensation, while the average for theother named executive officers was about 30 percent. However, the amount of base salary paid to eachnamed executive officer is a major determinant of the amounts of all other elements of compensation.For example, the annual awards under our Incentive Plan are based on a percentage of base salary. Seethe discussion under “Annual Incentive Compensation” below. Base salaries for each position arecompared on the basis of job content primarily to base salaries for similar positions in companies inour proxy peer group generally at the 50th percentile of the competitive market practice. Proposed basesalary ranges for the following calendar year are reviewed and considered by the HR Committee at itsmeeting in October of each year. In addition, at the same meeting, our CEO provides the HRCommittee with an oral presentation discussing his individual performance and contributions for thepreceding fiscal year, along with an evaluation of each other named executive officer’s performanceduring that year.

Each named executive officer’s base salary for the calendar year beginning January 1, 2016 wasestablished by the HR Committee after considering the competitive benchmarking data for eachposition discussed below, the committee’s subjective evaluation of the performance of each namedexecutive officer, the value of the individual in the position to the Company relative to other positionsand his level of experience, the Company’s base salary increase budget and guidelines as well ascurrent economic conditions. As a result, the HR Committee approved an increase of three percent(3%) in base salary for the 2016 calendar year for each of the named executive officers, except forMr. Haefner, resulting in the following amounts, as noted below:

Name Base Salary

Kim R. Cocklin $975,259Michael E. Haefner $520,000Bret J. Eckert $439,080Louis P. Gregory $387,406Marvin L. Sweetin $371,418

Mr. Haefner received a ten percent (10%) increase in base salary to $520,000 in connection withhis promotion to President and COO, effective October 1, 2015, with no additional increase as ofJanuary 1, 2016. The total amounts of each base salary actually paid during fiscal 2016 exceed theamounts shown above due to timing issues since each named executive officer received compensationfor an extra payroll period (total of 27 bi-weekly payroll periods) during the fiscal year. The HRCommittee believes that the base salaries provided to each of the named executive officers areappropriate to retain and motivate them, are competitive with salaries offered for similar positions bycompanies in our proxy peer group and are consistent with our Total Rewards strategy.

Annual Incentive Compensation. We believe it is important to provide our named executiveofficers with a reasonable financial incentive to maximize the Company’s financial performance eachyear. Through our Incentive Plan, we provide our named executive officers an opportunity to earn anannual incentive award based upon the Company’s actual financial performance each year as measuredby our fully diluted EPS for that fiscal year. The EPS performance measurement is the lynchpin of bothour short-term (annual) and long-term incentive compensation plans. The HR Committee believes thatEPS is the most appropriate measurement of our financial performance both on an annual and long-term basis, because it most accurately reflects the growth and performance of our operations. The EPS

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measurement is also one of the most current well-known measurements of overall financialperformance of public companies, which is widely used by financial analysts as well as the investingpublic. The HR Committee believes that using this measurement as the basis for our incentivecompensation plans best aligns the interests of our named executive officers with the interests of ourshareholders and customers.

For fiscal 2016, the HR Committee reviewed competitive compensation benchmarking data, asdiscussed below, to establish an annual target opportunity expressed as a percentage of base salaryearned during the fiscal year by each named executive officer. The target incentive award opportunitiesfor each such officer are reviewed each year and benchmarked against the 50th percentile for similarpositions by companies in our proxy peer group as described above in “Executive CompensationProgram Objectives and Strategy,” beginning on page 38.

The Incentive Plan targets for fiscal 2016 for each of the named executive officers were asfollows:

Name

Fiscal Year 2016Incentive Plan Targetas Percentage (%) ofBase Salary Earned

Kim R. Cocklin 90

Michael E. Haefner 75

Bret J. Eckert 60

Louis P. Gregory 55

Marvin L. Sweetin 55

At its meeting in October 2015, the HR Committee established the threshold, target and maximumperformance levels of EPS upon which the Incentive Plan’s awards would be based for fiscal 2016,along with the corresponding percentages of target awards. The target EPS performance level wasbased on our annual business plan and budget and took into account such factors as the allowed ratesof return in our established service areas, natural gas pricing and volatility, budgeted capitalexpenditures, expected growth within our service areas, competitive factors from other serviceproviders and other business considerations embedded in our annual business planning process. TheHR Committee has continued to set increasingly challenging EPS target performance levels under theIncentive Plan each fiscal year, as demonstrated by increasing such target performance levels onaverage of around 8.6% per year over the last five fiscal years. Such target performance levels havealso continued to be within the range of announced EPS guidance provided to the public in Novemberof each year.

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For each of the last three fiscal years prior to fiscal 2016, we exceeded our target level ofperformance based on EPS, with the payouts to our named executive officers averaging approximately154 percent of their target awards each year over that period. The following table summarizes theperformance levels and actual performance level attainment under the Incentive Plan for fiscal 2016:

Performance LevelAnnual EPSPerformance

Percentage (%) ofTarget Award Earned

Below Threshold <$2.97 No award

Threshold $2.97 50

Target $3.30 100

Adjusted EPS Earned(a) $3.37 121

Maximum $3.63 200

(a) The performance levels and actual performance level attainment for the Incentive Plan exclude any unrealizedgains or losses recognized by the Company’s non-regulated operations to remove the impact of such gains orlosses on earnings since they do not truly reflect the operating performance of the Company.

Since the actual EPS performance level attained was between the target of $3.30 per share andmaximum of $3.63 per share, straight-line interpolation was used to compute the percentage of thetarget award earned. The HR Committee has the discretion under the Incentive Plan to make downwardadjustments to earned awards but may not make upward adjustments. For fiscal 2016, the HRCommittee did not use its discretion to make negative adjustments to any awards for any of our namedexecutive officers. However, the HR Committee does place a limit under certain conditions on theamount of earned awards for all our named executive officers. If the Company’s TSR during any fiscalyear is negative, the earned award for each such officer for that fiscal year will be limited to theamount earned at the target level of performance. This limitation was not applicable in fiscal 2016since the Company’s TSR was positive for the fiscal year at 31 percent.

Awards under the Incentive Plan are paid in cash and are based on the participant’s eligibleearnings received during the fiscal year. However, participants may elect prior to the beginning of eachfiscal year to convert all or a portion of their awards to time-lapse RSUs with three year cliff vesting,with a premium equal to 20 percent of the amount converted, with such units being awarded under ourLTIP. In addition, for fiscal years prior to 2017, participants were given the option of electing toconvert all or a portion of their awards to shares of bonus stock, with a premium equal to five percent(5%) of the amount converted. However, beginning with elections effective for fiscal 2017, this optionhas been eliminated.

Long–Term Incentive Compensation. The HR Committee awards grants under our LTIP eachfiscal year that are structured with 50 percent of the targeted long-term value in the form of three-fiscalyear performance-based RSUs with the remaining 50 percent in the form of time-lapse RSUs withthree year cliff vesting. The HR Committee believes that the payment of long-term incentivecompensation in the form of grants of performance-based RSUs, as measured by cumulative EPS overa three-fiscal year performance period, rewards our named executive officers for improved financialperformance of the Company, thereby giving them an incentive to enhance long-term shareholdervalue. The HR Committee also believes that grants of time-lapse RSUs promotes and encourageslong-term retention and service to the Company, aligns the interests of our named executive officerswith those of our shareholders through increased share ownership and provides a balanced approach tolong-term compensation. The HR Committee bases the actual number and value of awards grantedprimarily on the competitive compensation benchmarking of grants made by the companies in our

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proxy peer group, as discussed below. The Board has also granted our CEO, Mr. Cocklin, the authorityto award up to a total of 10,000 performance-based RSUs and time-lapse RSUs in the aggregate in off-cycle grants each fiscal year to newly-hired eligible LTIP participants or to then-current LTIPparticipants in connection with a promotion.

The HR Committee bases the three-fiscal year cumulative EPS target performance levels on thesame factors they utilize for our Incentive Plan described above. The HR Committee has alsohistorically set increasingly challenging cumulative three-fiscal year EPS target performance levelseach year, by increasing such target performance levels on average of around 9.0 percent per year forgrants over the last five fiscal years. For the grants of performance-based RSUs whose performanceperiods ended during the three fiscal years prior to fiscal 2016, we exceeded our target level ofperformance based on cumulative EPS over the three-fiscal year performance period for all suchgrants, with the payouts to the named executive officers averaging approximately 159 percent of theirtarget awards each year over that period. The following table summarizes the performance levels andactual performance attainment levels for the fiscal 2014-2016 performance period relating to the grantsof performance-based RSUs awarded in May 2014:

Performance LevelCumulative

EPS PerformancePercentage (%) of

Target Award Earned

Below Threshold <$7.84 No award

Threshold $7.84 50

Target $8.71 100

Actual Performance(a) $9.37 176

Maximum $9.58 200

(a) The performance levels and actual performance attainment during the three-fiscal year performance periodexclude any unrealized gains or losses recognized by the Company’s nonregulated operations to remove theimpact of such gains or losses on earnings since they do not truly reflect the operating performance of theCompany.

Since the actual performance level attained over the performance period was $9.37 per share, eachnamed executive officer earned 176 percent of his target award. The awards were paid in the form ofshares of common stock issued in November 2016 with the named executive officers also receivingcumulative cash dividend equivalents over the three-fiscal year performance period on such awards. Aswith the payout of Incentive Plan awards, if the Company’s TSR during the performance period isnegative, the earned award for each such officer for such performance period will be limited to theamount earned at the target level of performance. This limitation was not applicable for the fiscal2014-2016 performance period since the Company’s TSR was positive for such performance period at90 percent.

At its meeting in October 2015, the HR Committee also established the threshold, target andmaximum performance levels of cumulative EPS upon which performance-based RSUs awards wouldbe based for the fiscal 2016-2018 performance period, along with the corresponding percentages oftarget awards. The three-fiscal year cumulative EPS target performance level was based on the samefactors utilized by the HR Committee for our Incentive Plan described above. The HR Committee thenawarded grants to the named executive officers at its meeting in March 2016, which were later ratifiedby the Board, of performance-based RSUs for the fiscal 2016-2018 performance period. Theperformance levels and actual performance level attainment for such performance-based RSUs willagain exclude any mark-to-market gains or losses recognized by the Company’s nonregulated

43

operations to remove the impact of such gains or losses on earnings over the three-fiscal yearperformance period. The following table shows the three year performance criteria for such period:

Performance LevelCumulative

EPS PerformancePercentage (%) of

Target Award Earned

Below Threshold <$9.55 No award

Threshold $9.55 50

Target $10.61 100

Maximum $11.67 200

Retirement Benefits. All of our named executive officers, other than Mr. Eckert, participate inour Pension Account Plan (“PAP”), which is a qualified, cash balance defined benefit pension plan.Benefits under this plan become vested and non-forfeitable after completion of three years ofcontinuous employment. For any named executive officer who retires with vested benefits under theplan, the compensation shown as “Salary” in the “Summary Compensation Table for Fiscal Year2016,” beginning on page 51, would be considered eligible compensation in determining benefits. Seethe discussion under “Pension Account Plan,” beginning on page 56, for more information about thisplan. In addition, all of our named executive officers participate in our RSP, which is a definedcontribution plan. Because Mr. Eckert joined the Company after September 30, 2010, he has not beeneligible to participate in the PAP. However, in lieu thereof, Mr. Eckert has received a fixed annualCompany (“FAC”) contribution, which is equal to four percent (4%) of his eligible earnings. See thediscussion under “Retirement Savings Plan” on page 57 for more information about this plan.

Our named executive officers also participate in a supplemental retirement plan, which providesretirement benefits (as well as supplemental disability and death benefits). Generally, each of ournamed executive officers who has participated in the plan for at least two years and who has attainedthe age of 55 is entitled to an annual retirement supplement in an amount that, when added to theannual retirement amount payable to him under either the PAP or cumulative FAC contribution portionof the RSP, equals 60 percent of his total cash compensation. The annual supplemental retirementamount will generally be equal to the sum of the amount of the participant’s last annual base salary andthe amount of his last award under the Incentive Plan, subject to reductions for less than ten years ofemployment with the Company and for retirement prior to age 62. The HR Committee believes thatthese retirement benefits at the amounts provided to our named executive officers are an importantcomponent of total compensation and benefits and are required to ensure that our overall executivecompensation package remains competitive with executive compensation packages offered by othermajor public companies in our industry. See the discussion under “Retirement Plans,” beginning onpage 56, for more information on our retirement benefits.

Change in Control Severance Benefits. We have severance agreements in place with each of ournamed executive officers to provide certain severance benefits for them in the event of the terminationof their employment within three years following a “change in control” of the Company (as defined inthe severance agreements and described generally in “Change in Control Severance Agreements,”beginning on page 59. The severance agreement for each named executive officer generally providesthat the Company will pay such officer as severance pay in one lump sum an amount equal to(a) 2.5 times his total compensation (annual base salary and the higher of the last annual award underthe Incentive Plan or the average of the three highest annual awards received under such plan) and(b) for a named executive officer participating in the PAP, the total of (i) an amount that is actuariallyequivalent to an additional three years of annual age and service credits payable to the officer under the

44

PAP and (ii) an amount that is actuarially equivalent to an additional three years of Company matchingcontributions payable to the officer under the RSP or (c) for a named executive officer who is notparticipating in the PAP (i) an amount that is actuarially equivalent to an additional three years of FACcontributions under the RSP and (ii) an amount that is actuarially equivalent to an additional threeyears of Company matching contributions payable to the executive officer under the RSP.

In addition, each named executive officer is paid (i) an amount that is generally actuariallyequivalent to an additional 36 months of health and welfare benefits and (ii) an amount that isactuarially equivalent to 36 months of accident and life insurance coverage, along with disabilitycoverage. If the total of such lump sum severance payment results in the imposition of excise taxesimposed by Section 4999 of the Code, the named executive officer has the ability to elect to have thepayment reduced to a level that will result in no payment of such excise tax. In lieu of reducing theseverance payment under the agreement, each named executive officer may elect to have the Companypay the full severance payment amount, thereby leaving such officer responsible for personally payingthe excise tax penalties imposed on such “excess parachute payments.”

Additional Information on Named Executive Officer Compensation

The compensation of our CEO, Mr. Cocklin, was higher in fiscal 2016 than that of any of ourother named executive officers, primarily in recognition of his level of responsibility and thecompetitive market data for chief executive officers of comparably-sized companies in our proxy peergroup. However, Mr. Cocklin participated in all the same compensation plans as the other namedexecutive officers and was subject to the same performance measurement determinations under ourannual and long-term incentive compensation plans. We do not have any individual compensationpolicies or plans that are not applied consistently to all of our named executive officers. We also do nothave a policy under which the annual levels of compensation and the grants of both Incentive Plan andLTIP awards are adjusted each year to reflect the projected gains that may be realized by an executiveofficer from stock-based compensation. Each year, we set our target opportunities in incentivecompensation based solely upon competitive market conditions and the other factors discussed below.

In addition, the HR Committee and our Board of Directors considered the results of our mostrecent shareholder advisory vote on executive compensation at our February 3, 2016 meeting ofshareholders. Our shareholders overwhelmingly approved the compensation of our named executiveofficers for fiscal 2015, with approximately 96 percent of the shares voted in favor of suchcompensation. Accordingly, the HR Committee and our Board decided to continue to adhere to its pay-for-performance philosophy and did not materially change our executive compensation decisions andpolicies over the last fiscal year as a result of the most recent shareholders’ advisory vote on executivecompensation or otherwise. However, the HR Committee and Board will continue to review ourexecutive compensation program each year and will consider the views of our shareholders and otherdevelopments during such review.

Competitive Executive Compensation Benchmarking

Like all major corporations, we operate in a competitive environment for talented executives. PayGovernance provided our HR Committee with a comprehensive review of the compensation programelements and pay levels for companies similar to us and of comparable size as measured by financialmeasures and market capitalization for fiscal 2016. The competitive compensation benchmarkingincluded assessments of all elements of compensation for our named executive officers. The

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competitive compensation benchmarking data reviewed by the HR Committee included base salary,annual incentive compensation and long-term incentive compensation found in the proxy statementsfiled by companies in the proxy peer group. The companies in the proxy peer group were selectedbecause they represent those companies considered by the HR Committee to be the most comparable tothe Company in terms of business operations, market capitalization and overall financial performance.The companies in the proxy peer group for the following fiscal year are selected annually by the HRCommittee at its regularly-scheduled June meeting after its review of the recommendation of andpresentation by Pay Governance, which selection is then reviewed and approved by the Board at itsregularly-scheduled August meeting. The HR Committee recommended no changes to the members ofthe proxy peer group for fiscal 2016, which appears below. This same proxy peer group was used inthe stock performance graph appearing in our Annual Report on Form 10-K for the fiscal year endedSeptember 30, 2016. However, because AGL Resources Inc., Piedmont Natural Gas Company, Inc.,Questar Corporation and TECO Energy, Inc. were acquired during 2016, these companies will nolonger be members of the proxy peer group for fiscal 2017.

AGL Resources Inc. Questar CorporationCenterPoint Energy, Inc. TECO Energy, Inc.CMS Energy Corporation The Laclede Group, Inc.NiSource Inc. Vectren CorporationONE Gas, Inc. WGL Holdings, Inc.Piedmont Natural Gas Company, Inc.

The annual revenues shown below for the companies in our proxy peer group are for the mostrecent fiscal year reported. The market capitalizations shown below are as of April 30, 2016.

Revenues($ Billion)

Market Cap.($ Billion)

Minimum 1.1 2.8

Average 3.3 5.9

Maximum 7.4 11.4

Atmos Energy Corporation 3.3 7.4

To supplement the executive compensation information derived from its study of the proxy peergroup, the HR Committee also considered, on a limited basis, executive compensation benchmarkingdata from the latest Willis Towers Watson U.S. CDB Energy Services Executive Compensation Survey(“energy services industry survey”) provided by Pay Governance. The companies in this surveyinclude companies in the natural gas, nuclear and electric utilities industries. To adjust for sizedifferences, Pay Governance employed a statistical analysis (single regression) in the survey based onrelative total annual revenues to determine competitive pay rates for our named executive officersbased upon the data derived from such survey. The HR Committee also briefly reviewed compensationdata from broader energy industry and general industry surveys provided by Pay Governance, as asecondary reference point that reflects broader pay practices.

Using primarily the proxy peer group compensation analysis, as well as limited supplemental datafrom the energy services industry survey, the HR Committee reviewed competitive targetcompensation levels for each named executive officer at the 50th percentile level of the competitivemarket. For each named executive officer position, base salary, target total cash compensation (basesalary plus annual incentive award) and target total direct compensation (base salary plus annual

46

incentive award plus the annualized present value of long-term incentive compensation) werebenchmarked and analyzed as the Company’s desired competitive compensation positioning. Inreviewing the competitive compensation data with the current base salaries and target compensationlevels of our named executive officers, the HR Committee found that base salaries, target total cashcompensation, and target total direct compensation for each of our named executive officers weregenerally aligned within the competitive range of the 50th percentile benchmarks for each element ofcompensation and in the aggregate.

Executive Compensation Consultant

The HR Committee has been granted through its charter the sole authority from the Board ofDirectors for the appointment, compensation and oversight of the Company’s executive compensationconsultant. The HR Committee retained Pay Governance during fiscal 2016 as its consultant to assistwith its responsibilities related to the Company’s compensation program for its named executiveofficers and Board of Directors. The HR Committee directed Pay Governance to (i) regularly attendmeetings of the committee, (ii) conduct studies of competitive compensation practices and (iii) developconclusions and recommendations related to the executive compensation plans of the Company forconsideration by the committee. Pay Governance prepared reports and analyses and assisted with(i) the identification of the Company’s proxy peer group, (ii) an assessment of competitivecompensation for non-employee directors of the Company, and (iii) a review of base salary, annualincentives and long-term incentive compensation opportunities of the Company relative to competitivepractices. Pay Governance also prepared a report on emerging trends and developments in executivecompensation, provided recommendations regarding our executive compensation strategy andperformed an assessment of the risks contained in the Company’s incentive compensation plans.

A senior consultant from Pay Governance attended two HR Committee meetings held in fiscal2016. Based on policies and procedures implemented by the HR Committee and by Pay Governance toensure the objectivity and independence of the individual executive compensation consultants for PayGovernance, the committee believes that the consulting advice it received during the fiscal year fromPay Governance and its individual consultants was objective, not influenced by any other relationshipsPay Governance had with the Company and raised no conflicts of interest. In making thisdetermination, the HR Committee also assessed the independence factors set forth in applicable SECregulations and rules, NYSE corporate governance standards and other facts and circumstances andconcluded that both Pay Governance and its individual consultants were independent from theCompany.

Management’s Role in Setting Named Executive Officer Compensation

The HR Committee and Mr. Cocklin, our CEO, met with representatives of Pay Governance at thebeginning of fiscal 2016 to review and discuss the compensation of all other named executive officers.However, at no time did Mr. Cocklin meet with representatives of Pay Governance regarding his owncompensation. The only other named executive officer of the Company who regularly worked with PayGovernance during fiscal 2016 was the President and COO, Mr. Haefner. For fiscal 2016, Mr. Cocklinrecommended to the HR Committee compensation for Messrs. Haefner, Eckert, Gregory and Sweetin,while Pay Governance provided to the committee general guidance and competitive compensation datafor Mr. Cocklin.

Mr. Cocklin may be present during a portion of the HR Committee’s meetings on executivecompensation. However, Mr. Cocklin (along with any other named executive officers in attendance at

47

HR Committee meetings), is excused when the compensation of such named executive officers isdiscussed and decisions regarding their compensation are reached by the committee. All decisions bythe HR Committee concerning all forms of executive compensation to be paid to the CEO and theother named executive officers are approved by the Board.

Share Ownership Guidelines

We have adopted share ownership guidelines for our named executive officers, which arevoluntary and are intended to be achieved by each such named executive officer over the course offive years. The HR Committee believes that executive share ownership promotes better alignment ofthe interests of our named executive officers with those of our shareholders and it monitors compliancewith the ownership guidelines each year. Our CEO has a guideline to reach a share ownership positionwith a value of at least five times his base salary, with each of the remaining named executive officershaving a guideline to reach a share ownership position with a value of at least three times theirrespective annual base salaries. The share ownership positions include all shares held directly orindirectly, including grants of unvested time-lapse RSUs but not including grants of unvestedperformance-based RSUs. Each of our named executive officers serving as of the end of fiscal 2016had achieved his individual ownership objective as of that time.

Executive Compensation-Related Policies

Executive Compensation Recoupment Policy. Our Board of Directors has adopted an executivecompensation recoupment policy or “clawback policy,” which provides for the recoupment by theCompany under certain circumstances of awards of incentive compensation, including annual cashincentive compensation, stock-based awards, performance-based compensation and any other forms ofcash or equity compensation other than base salary. This policy applies to any current or formeremployee holding (or in certain cases, who held) a position of division president, corporate vicepresident or above.

First, in the event of an accounting restatement of the Company’s previously issued financialstatements due to the material noncompliance of the Company with any financial reporting requirementunder the federal securities laws, the Company will seek recovery from any such current or former officerwho received any awards paid or granted during the three-year period preceding the date on which theCompany is required to prepare an accounting restatement, based on the erroneous data, in excess ofwhat would have been paid or granted to the officer under the accounting restatement.

Next, in the event of an accounting restatement as a result of errors, omission, fraud or othercauses, the HR Committee shall review the facts and circumstances underlying the restatement(including any potential wrongdoing and whether the restatement was the result of negligence orintentional or gross misconduct) and may, in its discretion, direct that the Company recover all or aportion of any award from one or more officers with respect to any fiscal year in which the Company’sfinancial results are negatively affected by such restatement. If (a) the payment, grant or vesting of anyaward(s) is based upon the achievement of financial results that are subsequently restated or (b) alower payment, award value or vesting would have occurred based upon the restated financial results,the HR Committee may seek to recoup, and such officer shall forfeit or repay, all or any portion ofsuch excess compensation as the committee deems appropriate.

Finally, if the HR Committee determines that an officer engaged in an act of fraud or misconductthat contributed to the need for an accounting restatement, the committee may, in its discretion, recover

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and the officer shall forfeit or repay, all of such officer’s awards for the relevant period, plus areasonable rate of interest. The recoupment pursuant to this policy of any awards of incentivecompensation from an officer will not affect the Company’s right to pursue disciplinary action ordismissal, pursue any available legal remedies against such officer or its ability to recoup executivecompensation under applicable laws and regulations. Following the adoption of the final rule by theSEC on clawback policies, this clawback policy will be amended, if necessary to maintain fullcompliance with such final rule.

Policy Prohibiting Hedging and Pledging Transactions. Our Board of Directors has alsoadopted a policy prohibiting hedging transactions in our common stock through an amendment to ourinsider trading policy, which provides that no member of our Board of Directors or any employee ofthe Company may purchase any financial instruments (including, without limitation, prepaid variableforward contracts, equity swaps, collars and exchange funds) that establish a short position in ourcommon stock and are designed to hedge or offset any decrease in the market value of our commonstock granted by us as part of compensation to employees or our common stock already held by them.In addition, the following transactions are prohibited: (i) “short sales,” which are sales of our commonstock that are not then owned and (ii) trading of put options, call options or other derivatives of ourcommon stock. Finally, our insider trading policy also provides that no member of our Board ofDirectors or any named executive officer of the Company may purchase our common stock on marginor hold our common stock in a margin account, borrow against any account in which our commonstock is held or otherwise pledge our common stock as collateral for a loan.

Compensation Risk Assessment

During fiscal 2016, the HR Committee engaged Pay Governance to assist the committee inassessing the risk profile of the compensation plans of the Company. Pay Governance reviewed all of thecompensation plans of the Company to gauge whether any compensation plan encourages employees toengage in excessively risky behaviors detrimental to the Company and its shareholders. Our two annualincentive compensation plans are the Incentive Plan and the Variable Pay Plan (“VPP”). Pay Governancealso evaluated our long-term incentive plan, the LTIP, pursuant to which the Company grants bothperformance-based and time-lapse RSUs. The review by Pay Governance of these incentive plansincluded an evaluation of the plans’ design features and provisions, including such provisions as theestablishment of target levels, the determination of awards, the types of performance criteria measured,the capping of maximum award opportunities, the balance between annual and long-term opportunities,the role of the HR Committee in its governance and oversight and other issues.

At the conclusion of its review and evaluation, Pay Governance reported to the HR Committeethat none of these incentive compensation plans encourage our employees to engage in excessive risk-taking behaviors, based on the following factors:

‰ The Company’s incentive compensation plans do not appear to have attributes commonlyconsidered to be problematic or reflect poor pay practices;

‰ The structure of the Company’s compensation program does not directly or indirectly incorporateunsystematic risk factors affecting the financial performance of the Company; and

‰ The Company has numerous policies and practices in place intended to help mitigate potentialrisks, including appropriate performance metrics, long-term incentive opportunities whichcounterbalance short-term incentive opportunities, caps on annual incentive opportunities andstock ownership requirements for selected members of management.

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In particular, Pay Governance reported that the following features help to mitigate any excessiverisk-taking on the part of the participants in these plans:

‰ Both the Incentive Plan and the VPP place a cap on the size of any cash awards earned by anysingle participant during the plan year.

‰ Awards under the Incentive Plan and grants of performance-based RSUs under the LTIP subjectto objective, formulaic performance criteria that are reviewed and approved by the plans’governing authority (i.e., the HR Committee) no later than during the first quarter (90 days) of allperformance periods under each plan.

‰ Once the threshold levels are achieved, both the Incentive Plan and the LTIP use mathematicalinterpolation to calculate payouts between performance levels, thereby removing any payout cliffs.

‰ Long-term equity incentives are granted each year to Incentive Plan participants to appropriatelybalance short-term interests and long-term value creation (and for named executive officers only,are subject to a TSR limitation).

‰ One-half of the value of the long-term incentive opportunity for participants is represented byperformance-based RSUs, which are tied to three-fiscal year cumulative earnings per share(“EPS”) performance measures for all participants (and for named executive officers only, aresubject to a TSR limitation).

‰ The Incentive Plan allows participants to make a voluntary conversion of annual cash awards, in25 percent increments, to three-year time-lapse RSUs, with a 20 percent premium.

‰ All performance targets under the Incentive Plan and the LTIP, as well as the measurement ofactual performance attained under each such target, exclude any unrealized gains or lossesrecognized by the Company’s nonregulated operations.

‰ Any potential severance compensation paid to a named executive officer in the event of a changein control is subject to a double-trigger termination requirement and does not include any federalincome tax gross-up payments for the purposes of excise tax payment settlements.

‰ The Company has adopted a clawback policy that provides for the repayment or forfeiture of anyincentive awards, excluding base salary, earned due to restatement of financial statements, fraud,misconduct, or other unethical behavior.

‰ The Company has adopted a policy that prohibits hedging transactions in the Company’s shares ofcommon stock by any employee or non-employee director.

‰ All officers are subject to voluntary share ownership guidelines, which encourage the executivesto own Company shares of common stock with a value equal to a multiple of their base salaries,commensurate with their positions with the Company, thereby aligning their long-term interestswith the long-term interests of the Company’s shareholders.

‰ For purposes of ongoing potential eligibility with respect to deductions under Section 162(m) ofthe Code, certain aspects of the Incentive Plan and the LTIP are subject to the approval of ourshareholders at least every five years.

Accordingly, the HR Committee has determined that none of the Company’s incentivecompensation plans encourage our executive officers or other employees to take excessive risks andthat the risks arising from these plans are not reasonably likely to have a material adverse effect on theCompany.

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NAMED EXECUTIVE OFFICER COMPENSATION

Summary of Cash and Other Compensation

The following table provides information concerning compensation we paid to or accrued onbehalf of our Principal Executive Officer, our Principal Financial Officer and the three other mosthighly compensated executive officers serving as such on September 30, 2016:

Summary Compensation Table for Fiscal Year 2016(a)

Name and Principal Position YearSalary

($)

StockAwards($)(b)

Non-EquityIncentive PlanCompensation

($)(c)

Change inPension Value

andNonqualified

DeferredCompensation

Earnings($)(d)

All OtherCompensation

($)(e)Total

($)

Kim R. CocklinChief Executive Officer

201620152014

1,004,138938,580906,311

2,543,2242,055,4062,339,190

1,095,4041,207,9521,386,656

4,039,5722,981,5684,121,369

18,47925,59820,000

8,700,8177,209,1048,773,526

Michael E. HaefnerPresident and ChiefOperating Officer

201620152014

537,625426,689335,879

1,189,852609,221454,319

488,741396,607314,047

2,296,1711,688,684

825,030

12,40513,11713,131

4,524,7943,134,3181,942,406

Bret J. EckertSenior Vice President andChief Financial Officer

201620152014

452,082422,566405,324

626,053501,050576,526

328,781362,562413,430

825,080462,460520,323

26,00523,00226,748

2,258,0011,771,6401,942,351

Louis P. GregorySenior Vice President,General Counsel andCorporate Secretary

201620152014

398,877372,835362,017

493,754416,182458,527

265,914293,235338,486

893,567401,047

1,051,194

12,51513,05214,202

2,064,6271,496,3512,224,426

Marvin L. Sweetin (f)Senior Vice President, Safetyand Enterprise Services

201620152014

382,416357,449347,077

491,349413,397456,135

254,940281,134324,517

757,634443,315459,257

13,04513,01212,769

1,899,3841,508,3071,599,755

(a) No bonuses, as defined by applicable SEC rules and regulations, were paid or stock options awarded to any named executive officers infiscal years 2016, 2015 or 2014.

(b) In accordance with applicable SEC rules, the valuation of stock awards in this table is based upon the grant date fair value of time-lapseRSUs granted during fiscal 2014-2016, along with performance-based RSUs granted during fiscal 2014-2016 and excludes any estimateof forfeitures related to service vesting conditions. The stock awards are valued at the grant date fair value calculated in accordance withFASB ASC Topic 718. The valuation also includes the fair value of a 20 percent premium granted in connection with the time-lapseRSUs converted from the portion of incentive compensation elected to be converted by the named executive officers in the prior fiscalyear. In our financial statements, we use an estimated forfeiture rate of two percent (2%) of each grant (other than special one-timegrants). The fair value of time-lapse RSUs and performance-based RSUs was determined based on the fair market value on the grantdate.

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The fair value of the performance-based RSUs on the grant date are shown in the following table at their maximum value, assuming thehighest level of performance conditions (200 percent of the target) will be achieved during the performance period.

Name Year

StockAwards

($)

Kim R. Cocklin 2016 2,482,8262015 1,986,0592014 2,280,594

Michael E. Haefner 2016 1,110,5242015 546,4062014 400,507

Bret J. Eckert 2016 626,0532015 501,0502014 576,526

Louis P. Gregory 2016 435,0662015 348,4412014 400,507

Marvin L. Sweetin 2016 435,0662015 348,4412014 400,507

(c) The amounts shown reflect the payments attributable to performance achieved at the level of 121 percent of target EPS in fiscal 2016under our Incentive Plan. For a discussion of the performance criteria established by our HR Committee for awards in fiscal 2016 underour Incentive Plan, see “Elements of Executive Compensation,” beginning on page 39. Awards under the Incentive Plan are paid in cashand are based on the participant’s eligible earnings received during the fiscal year. However, participants may elect prior to the beginningof each fiscal year to convert all or a portion of their awards either to time-lapse RSUs, with a premium equal to 20 percent of the amountconverted, or (through fiscal 2016) to bonus stock, with a premium equal to five percent (5%) of the total amount converted, with suchunits being awarded under our LTIP. The amounts shown do not include incentive compensation equal to the premium of 20 percent ofthe value associated with the conversion to time-lapse RSUs through an election by participating named executive officers prior to thebeginning of fiscal 2016, as shown in the table below. The grants of the units resulting from such conversion, which were madeNovember 8, 2016 at a fair market value of $73.29 per share, will be reflected in the Grants of Plan-Based Awards table in our proxystatement for fiscal 2017. These units vest three years following the date of grant. The conversion elections are reflected in the tablebelow.

Name

IncentivePlan

Award($)

Cash(%)

Amount($)

RestrictedStockUnits

Elected(%)

Value ofRestricted

StockUnits

($)Units

(#)

Kim R. Cocklin 1,095,404 75 821,553 25 328,706 4,485

Michael E. Haefner 488,741 100 488,741 — — —

Bret J. Eckert 328,781 100 328,781 — — —

Louis P. Gregory 265,914 — — 100 319,178 4,355

Marvin L. Sweetin 254,940 — — 100 305,986 4,175

(d) The amounts shown reflect the aggregate current year increase in pension values for each named executive officer, other than Mr. Eckert,based on the change in the present value of the benefit as presented in the “Retirement Plans Table for Fiscal Year 2016,” beginning onpage 58. The present value is based on the earliest age for which an unreduced benefit is available and assumptions from theSeptember 30, 2015 and September 30, 2016 measurement dates. For Mr. Eckert, the change in present value reflects the increase in hisSupplemental Executive Retirement Plan (“SERP”) pension benefit and an increase in the value of his FAC contributions benefit earnedunder our RSP.

(e) The components of “All Other Compensation” are reflected in the table below.

(f) Mr. Sweetin will be retiring from the Company effective December 31, 2016.

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All Other Compensationfor Fiscal Year 2016

Name

CompanyContributionsto RetirementSavings Plan

($)

Cost ofPremiums for

Company-Paid

Term LifeInsurance

($)

FinancialPlanning

($)(a)Perquisites

($)(b)Total

($)

Kim R. Cocklin 11,008 1,397 6,074 — 18,479Michael E. Haefner 11,008 1,397 — — 12,405Bret J. Eckert 21,608(c) 1,397 3,000 — 26,005Louis P. Gregory 11,008 1,397 110 — 12,515Marvin L. Sweetin 11,008 1,397 640 — 13,045

(a) We provide financial planning services to our named executive officers, which benefit is valued at the actual charge for the services.

(b) No named executive officer received perquisites and other personal benefits with an aggregate value equal to or exceeding $10,000during fiscal 2016.

(c) Includes FAC contributions under the RSP of $10,600.

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Grants of Plan-Based Awards

The following table shows the grants of executive compensation plan-based awards to the namedexecutive officers during fiscal 2016:

Grants of Plan-Based Awards for Fiscal Year 2016(a)

NameGrantDate

Estimated Future PayoutsUnder Non-Equity Incentive

Plan Awards(b)

Estimated Future PayoutsUnder Equity Incentive Plan

Awards(c)

All OtherStock Awards:

Number ofShares of

Stock or Units(#)

Grant DateFair Value

of StockAwards

($)Threshold

($)Target

($)Maximum

($)Threshold

(#)Target

(#)Maximum

(#)Kim R. Cocklin

Incentive Plan 10/01/15 451,862 903,724 1,807,448 — — — — —Time-Lapse RSUs 11/04/15 — — — — — — 954 60,398(d)Time-Lapse RSUs 05/04/16 — — — — — — 16,835 1,241,413Performance-Based RSUs 05/04/16 — — — 8,418 16,835 33,670 — 1,241,413

Michael E. HaefnerIncentive Plan 10/01/15 201,609 403,219 806,438 — — — — —Time-Lapse RSUs 11/04/15 — — — — — — 1,253 79,327(d)Time-Lapse RSUs 05/04/16 — — — — — — 7,530 555,262Performance-Based RSUs 05/04/16 — — — 3,765 7,530 15,060 — 555,262

Bret J. EckertIncentive Plan 10/01/15 135,625 271,249 542,498 — — — — —Time-Lapse RSUs 05/04/16 — — — — — — 4,245 313,026Performance-Based RSUs 05/04/16 — — — 2,123 4,245 8,490 — 313,026

Louis P. GregoryIncentive Plan 10/01/15 109,691 219,382 438,765 — — — — —Time-Lapse RSUs 11/04/15 — — — — — — 927 58,688(d)Time-Lapse RSUs 05/04/16 — — — — — — 2,950 217,533Performance-Based RSUs 05/04/16 — — — 1,475 2,950 5,900 — 217,533

Marvin L. SweetinIncentive Plan 10/01/15 105,164 210,329 420,658 — — — — —Time-Lapse RSUs 11/04/15 — — — — — — 889 56,283(d)Time-Lapse RSUs 05/04/16 — — — — — — 2,950 217,533Performance-Based RSUs 05/04/16 — — — 1,475 2,950 5,900 — 217,533

(a) No stock options were awarded to any named executive officer in fiscal 2016.

(b) The amounts reflect the estimated payments which could have been made under our Incentive Plan, based upon the participant’s annualsalary as of the date presented. The plan provides that our named executive officers may receive annual cash incentive awards based onthe performance and profitability of the Company. The HR Committee establishes annual target awards for each such officer. The actualamounts received by the named executive officers in fiscal 2016 under the plan are set forth under the “Non-Equity Incentive PlanCompensation” column in the “Summary Compensation Table for Fiscal Year 2016,” beginning on page 51.

(c) The amounts reflect the performance-based RSUs granted under our LTIP, which vest three years from the beginning of the performancemeasurement period (October 1, 2015), at which time the holder is entitled to receive a percentage of the performance-based RSUsgranted, based on our cumulative EPS performance over the period October 1, 2015 to September 30, 2018, payable in shares of ourcommon stock, plus dividend equivalents payable in stock or cash. The grant date fair market value on May 4, 2016 of $73.74 isreflected at the target level of performance.

(d) The grant date fair value amounts reflect the 20 percent value premium received pursuant to an election under the Incentive Plan toconvert all or a portion of incentive compensation received for fiscal 2015 to time-lapse RSUs granted under our LTIP. Such RSUs weregranted at the fair market value of $63.31 on the date of grant on November 4, 2015.

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Outstanding Equity Awards

The following table shows the outstanding equity awards held by the named executive officers atSeptember 30, 2016:

Outstanding Equity Awards at Fiscal Year-End for 2016(a)

Stock Awards

Name

Number of Sharesof Stock or

Units of StockThat HaveNot Vested

(#)(b)

Market Value ofShares of Stock

or Units of StockThat HaveNot Vested

($)(c)

Equity Incentive PlanAwards: Number ofUnearned Shares,

Units or OtherRights That

Have Not Vested(#)(d)

Equity Incentive PlanAwards: Market or

Payout Value ofUnearned Shares, Units or

Other Rights ThatHave Not Vested

($)(c)

Kim R. Cocklin 79,226 5,899,960 35,445 2,639,589

Michael E. Haefner 38,421 2,861,212 12,650 942,046

Bret J. Eckert 14,590 1,086,517 8,940 665,762

Louis P. Gregory 31,143 2,319,219 6,215 462,831

Marvin L. Sweetin 30,278 2,254,803 6,215 462,831

(a) There were no securities underlying either unexercised stock options, which were exercisable or unexercisable, or unexercised unearnedoptions granted under any equity incentive plan at the end of fiscal 2016. This table does not include amounts of time-lapse RSUs thatwere granted in November 2016 as a result of elections by the named executive officers to convert all or a portion of incentivecompensation attributable to fiscal 2016. However, it does include amounts of time-lapse RSUs that were granted in November 2015 as aresult of elections by the named executive officers to convert all or a portion of their incentive compensation attributable to fiscal 2015.

(b) Represents time-lapse RSUs, which generally vest three years from the date of grant, as reflected in the next table.

(c) Market value is based on the closing price of our common stock of $74.47, as reported on the NYSE Consolidated Tape onSeptember 30, 2016.

(d) Represents performance-based RSUs. See footnote (c) to the “Grants of Plan-Based Awards for Fiscal Year 2016” table on page 54 for adiscussion of the vesting terms of our performance-based RSUs. Based on our performance through September 30, 2016, performance-based RSUs, at the target level of performance, will vest as indicated in the “Performance-Based Restricted Stock Units VestingSchedule” on page 56 below.

Time-Lapse Restricted Stock Units Vesting Schedule(a)

Name 11-05-16(b) 5-06-17(c) 11-04-17(b) 5-05-18(c) 11-04-18(b) 5-04-19(c) Total

Kim R. Cocklin 7,938 22,350 7,769 18,610 5,724 16,835 79,226

Michael E. Haefner 7,290 3,925 7,038 5,120 7,518 7,530 38,421

Bret J. Eckert — 5,650 — 4,695 — 4,245 14,590

Louis P. Gregory 7,858 3,925 7,586 3,265 5,559 2,950 31,143

Marvin L. Sweetin 7,534 3,925 7,274 3,265 5,330 2,950 30,278

(a) This table does not include amounts of time-lapse RSUs that were granted in November 2016 as a result of elections by the namedexecutive officers to convert all or a portion of incentive compensation received for fiscal 2016.

(b) The amounts represent time-lapse RSUs granted under our LTIP as a result of the participant’s election to convert all or a portion of hisIncentive Plan payment attributable to prior fiscal years.

(c) The amounts represent time-lapse RSUs granted under our LTIP, which vest three years from the date of grant.

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Performance-Based Restricted Stock Units Vesting Schedule(a)

Name 9-30-17 9-30-18 Total

Kim R. Cocklin 18,610 16,835 35,445

Michael E. Haefner 5,120 7,530 12,650

Bret J. Eckert 4,695 4,245 8,940

Louis P. Gregory 3,265 2,950 6,215

Marvin L. Sweetin 3,265 2,950 6,215

(a) The amounts represent performance-based RSUs, assuming the target level of performance, which vest at the end of each applicablethree-fiscal year performance period. Although these units vest at the dates indicated, they are not available for distribution in the form ofshares until the number of units earned based on the cumulative EPS amount for the performance period, along with dividend equivalentsfor the performance period payable in the form of cash or additional units, is finally determined and approved by the Board at itsNovember meeting each year.

Vested Common Stock

The following table sets forth the vested common stock received by the named executive officersduring fiscal 2016:

Stock Vested for Fiscal Year 2016

Name

Stock Awards(a)

StockAwards(#)(b)

ValueRealized on

Vesting($)(c)

Kim R. Cocklin 66,655 4,848,496

Michael E. Haefner 19,170 1,305,648

Bret J. Eckert 16,837 1,224,738

Louis P. Gregory 19,751 1,341,002

Marvin L. Sweetin 19,048 1,298,224

(a) The named executive officers elected to have vested shares withheld, in each case, to cover applicable state and federal taxes incurred,upon receipt of their vested shares. Such amounts of shares withheld are not reflected in the table above.

(b) Includes shares that vested during fiscal 2016 attributable to time-lapse RSUs as well as performance-based RSUs at the 176 percentlevel of performance for the fiscal 2014-16 performance period.

(c) The value received on vesting represents the fair market value of the shares received on the following dates: $60.85 on November 6,2015; $71.95 on April 30, 2016; and $73.29 on November 8, 2016.

Retirement Plans

Pension Account Plan. Our PAP is a qualified, cash balance defined benefit pension plan underboth the Code and the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).The plan covers a majority of our employees, including all named executive officers, other thanMr. Eckert, since he joined the Company after September 30, 2010 and was not eligible to participatein the PAP. Benefits under this plan become vested and non-forfeitable after completion of three yearsof continuous employment. Under the terms of the PAP, a vested participant receives a benefit basedon the value of the cash balance account at termination or retirement from the Company. Benefitspayable under our retirement plan are not offset by Social Security benefits. Under the Code, theannual compensation of each employee to be taken into account under our retirement plan for 2016cannot exceed $265,000.

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The amount of eligible earnings utilized under the PAP generally includes base salary earned,deferrals to the RSP and Code Section 125 (“cafeteria plan”) reductions, while it excludes (i) anyimputed income attributable primarily to Company-provided life insurance or financial planningservices and (ii) all incentive compensation, as well as expense reimbursements. All participants maychoose to receive their account balances in the form of a lump sum or an annuity. For any namedexecutive officer who retires with vested benefits under the plan, the compensation shown as “Salary”in the “Summary Compensation Table for Fiscal Year 2016,” beginning on page 51, would beconsidered eligible compensation in determining benefits, subject to applicable limitations under theCode.

Retirement Savings Plan. The RSP is a defined contribution plan, which is intended to complywith Section 404(c) of ERISA. All employees are eligible to participate in the RSP immediately uponjoining the Company. Investments may be made in shares of Company common stock or in a variety ofother equity and fixed income investments offered by the RSP administrator. Employees may makepre-tax contributions to the RSP based on the amount of eligible earnings, which is composedgenerally of base salary earned, pre-tax contributions to the RSP and cafeteria plan reductions, butexcludes (i) any imputed income attributable primarily to Company-provided life insurance or financialplanning services and (ii) all incentive compensation, as well as expense reimbursements. Upon thecompletion of one year of employment, the Company matches a participant’s contribution up to fourpercent (4%) of eligible earnings. Effective January 1, 2011, the RSP was amended to also include aFAC contribution, which is equal to four percent (4%) of eligible earnings for all participants in theRSP who joined the Company after September 30, 2010, when new employees ceased to be eligible toparticipate in the PAP. Eligible participants begin receiving the FAC contribution after one year ofemployment. All participants are immediately vested in their contributions to the RSP and matchingCompany contributions. Participants are vested in the FAC contributions component of their RSPaccount balances after three continuous years of employment.

Supplemental Executive Retirement Plan. All named executive officers participate in theCompany’s SERP, which provides retirement benefits (as well as supplemental disability and deathbenefits) to most officers and division presidents. For any participant in the SERP prior to November2008, the SERP provides that an officer or division president who has participated in the SERP for atleast two years and has attained age 55 is entitled to an annual supplemental pension in an amount that,when added to his or her annual pension payable under the PAP, equals 60 percent of hiscompensation, subject to reductions for less than ten years of employment and for retirement prior toage 62. The Board amended the SERP in November 2008 to provide that any participant who beginsparticipation in the SERP after November 2008 must have participated in the SERP for at least threeyears and attained age 55 to receive the same benefits, subject to reductions for less than ten years ofparticipation in the plan and for retirement prior to age 62.

The SERP covers compensation in an amount equal to the sum of (a) the greater of theparticipant’s annual base salary at the date of termination of employment or the average of theparticipant’s annual base salary for the highest of three calendar years (whether or not consecutive) ofemployment with the Company and (b) the greater of the amount of the participant’s last award underany of the Company’s annual performance bonus or incentive plans or the average of the participant’shighest three performance awards under such plans (whether or not consecutive). The amount ofcurrent compensation covered by the SERP at the end of fiscal 2016 for each of the named executiveofficers listed in the Summary Compensation Table is as follows: Mr. Cocklin, $2,230,749;Mr. Haefner, $1,008,741; Mr. Eckert, $810,175; Mr. Gregory, $694,645 and Mr. Sweetin, $665,978.

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Each of our named executive officers has also entered into a participation agreement with theCompany as required by the SERP, which provides that the accrued benefits, as calculated pursuant tothe plan, of each participant will vest if: (a) the plan is terminated by the Company; (b) the plan isamended by the Company, resulting in a decrease in the benefits otherwise payable to the participant;(c) the participant’s employment is terminated by the Company for any reason other than “cause;”(d) the participant’s participation in the plan is terminated by the Company for any reason other than“cause” prior to the participant’s termination of employment; (e) within any time during the three-yearperiod following a “change of control” of the Company (as such term is defined in the plan), (i) theparticipant’s employment is terminated involuntarily by the Company for any reason other than“cause” or (ii) the participant is demoted or reassigned to a position that would cause him to cease tobe eligible for participation in the plan; or (f) in anticipation of a “change in control” (whether or not a“change in control” ever occurs), if (i) the participant’s employment is terminated involuntarily by theCompany for any reason other than “cause” at the request of a party to a pending transaction thatwould constitute a “change in control,” if and when the transaction were consummated or (ii) theparticipant’s participation in the plan is terminated for any reason other than “cause” prior to theparticipant’s termination of employment. The participation agreements set forth the specific rights ofthe participants to their accrued benefits upon the occurrence of the events described above andconstitute enforceable contracts separate from the provisions of the SERP.

Retirement Plans Table

The table below shows the present value of accumulated benefits payable to each of the namedexecutive officers including the number of years of service credited to each such named executiveofficer under our PAP, RSP and SERP as applicable, along with the total amount of payments madeduring fiscal 2016 under the PAP. See the discussion under “Pension Account Plan,” beginning onpage 56, and “Supplemental Executive Retirement Plan,” beginning on page 57, for more informationon these plans. As discussed above under “Supplemental Executive Retirement Plan,” each of thenamed executive officers, other than Mr. Eckert, will receive a benefit under both the PAP and theSERP, the present values of which are presented in the table below. We used the followingassumptions in calculating the present value of accumulated benefits for the PAP and the SERP:

Retirement Plans Table for Fiscal Year 2016

‰ Retirement age: (a) 65, or current age if later, for the PAP and(b) 62, or current age if later, for theCompany’s SERP

‰ Discount Rate: 3.73 percent

‰ Postretirement mortality: Use of the applicable mortality table for 2016,as defined in Code Section 417(e)(3)

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Name Plan Name

Number ofYears

CreditedService(#)

PresentValue of

AccumulatedBenefit($)

PaymentsDuring

Last FiscalYear($)

Kim R. Cocklin(a) Pension Account Plan 10.33 276,318 —Supplemental Executive Retirement Plan 10.33 19,936,205 —

Michael E. Haefner(b) Pension Account Plan 8.25 201,682 —Supplemental Executive Retirement Plan 8.25 6,152,555 —

Bret J. Eckert(c) Retirement Savings Plan & Trust 4.25 57,587 —Supplemental Executive Retirement Plan 4.25 1,973,454 —

Louis P. Gregory(b) Pension Account Plan 16.00 454,718 —Supplemental Executive Retirement Plan 16.00 6,108,025 —

Marvin L. Sweetin(d) Pension Account Plan 16.33 319,682 —Supplemental Executive Retirement Plan 4.83 1,615,401 —

(a) Mr. Cocklin is eligible for retirement with an immediate PAP benefit and a full benefit under the SERP.

(b) Messrs. Haefner and Gregory are eligible for early retirement with an immediate PAP benefit and a reduced benefit under the SERP.

(c) Mr. Eckert participates in the RSP rather than the PAP since he joined the Company after September 30, 2010. The amount shown is thepresent value of the accumulated FAC contributions in his RSP account as of September 30, 2016. Upon attainment of age 55,Mr. Eckert will be eligible for early retirement with a reduced benefit under the SERP.

(d) Mr. Sweetin is eligible for early commencement of an immediate PAP benefit. Upon attainment of age 55, Mr. Sweetin will be eligiblefor early retirement with a reduced benefit under the SERP.

Change in Control Severance Agreements

We have entered into severance agreements with each of the named executive officers to providecertain severance benefits for them in the event of the termination of their employment within threeyears following a “change in control” of the Company (as defined in the severance agreements anddescribed generally below). In addition, each such named executive officer will be entitled to all rightsand benefits, if any, provided under any other plan or agreement between him and the Company.

The severance agreement for each such named executive officer generally provides that theCompany will pay such officer as severance pay in one lump sum an amount equal to (a) 2.5 times histotal compensation (annual base salary and the higher of the last award under the Incentive Plan or theaverage of the three highest awards under such plan (b) for an executive officer participating in thePAP, the total of (i) an amount that is actuarially equivalent to an additional three years of annual ageand service credits payable to the officer under the PAP and (ii) an amount that is actuariallyequivalent to an additional three years of Company matching contributions payable to the officer underthe RSP or (c) for an executive officer not participating in the PAP (i) an amount that is actuariallyequivalent to an additional three years of FAC contributions under the RSP and (ii) an amount that isactuarially equivalent to an additional three years of Company matching contributions payable to theofficer under the RSP. The Company is also obligated to provide the officer with all medical, dental,vision and any other health benefits which qualify for continuation coverage under CodeSection 4980B, for a period of 18 months from the date of termination. In addition, following the endof the 18-month period, the Company is to pay such officer a lump sum amount equal to the presentvalue of the cost to the Company of providing those benefits to him for an additional 18-month period.Also, the Company must pay the officer a lump sum amount equal to the present value of the cost tothe Company of providing accident and life insurance benefits as well as disability benefits for a periodof 36 months from his date of termination, equal to such benefits in effect for the officer at the time ofthe change in control.

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However, if an executive officer is terminated by the Company for “cause” (as defined in theseverance agreement), or his employment is terminated by retirement, death or disability, the Companyis not obligated to pay such officer the lump sum severance payment. Further, if an executive officervoluntarily terminates his employment except for “constructive termination” (as defined in theseverance agreement), the Company is not obligated to pay such officer the lump sum severancepayment. The Company is not responsible for the payment of any excise tax gross-up payments whichmay be due on the payment of severance benefits to our named executive officers. As a result, if suchlump sum severance benefit payments result in the imposition of excise taxes imposed by Section 4999of the Code, the officer will have the option to elect to have the payment reduced to a level that willresult in no payment of such excise tax by such officer.

For the purposes of these agreements, a “change in control” will generally be deemed to haveoccurred at any one of the following times:

‰ on the date any person acquires ownership of common stock, that together with stock already heldby such person, results in the person having beneficial ownership of 50 percent or more of thetotal fair market value or total voting power of our common stock;

‰ on the date that a person acquires, or has acquired over a 12-month period, ownership of ourcommon stock possessing 30 percent or more of the total voting power of our stock;

‰ on the date a majority of the members of our Board is replaced during any 12-month period bydirectors whose election is not endorsed by a majority of the Board before the date of the election;or

‰ on the date that a person acquires, or has acquired during the 12-month period ending on the dateof the most recent acquisition, at least 40 percent of the total gross fair market value of our assets,as measured immediately before such acquisition, except if such sale is to a person or entityowning, directly or indirectly, at least 50 percent of the total value or voting power of ourcommon stock before such acquisition.

For the purposes of these severance agreements, “cause” means (i) the willful and continuedfailure by the employee to substantially perform his duties with the Company (other than any suchfailure resulting from his incapacity due to physical or mental illness) after a written demand forsubstantial performance is delivered to the employee by the Board that specifically identifies themanner in which the Board believes that the employee has not substantially performed his duties or(ii) an employee’s willful engagement in conduct that is demonstrably and materially injurious to theCompany, monetarily or otherwise. No act, or failure to act, on an employee’s part shall be deemed“willful” unless done, or omitted to be done, by the employee not in good faith and without areasonable belief that the action or omission was in the best interests of the Company. Notwithstandingthe foregoing, the employee shall not be deemed to have been terminated for cause unless approved byan affirmative vote of not less than three-quarters (3/4) of the entire membership of our Board at ameeting called and held for such determination.

Potential Payments Upon Termination or Change in Control

Payments Made Upon Any Termination. Regardless of the manner in which a named executiveofficer’s employment is terminated, he is entitled to receive the following amounts earned during histerm of employment, subject to the additional restrictions discussed below under “Payments MadeUpon Termination for Cause.” Such amounts include:

‰ amount of accrued but unpaid base salary;

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‰ amounts contributed under, or otherwise vested in our RSP; and

‰ amounts accrued and vested through our PAP and SERP.

Payments Made Upon Retirement. In the event of the retirement of a named executive officer(only Messrs. Cocklin, Gregory and Haefner are eligible for retirement), in addition to the itemsidentified above, such named executive officer will be entitled to receive:

‰ a pro rata portion, at the end of the three-year performance period of each outstanding grant ofperformance-based RSUs under our LTIP, at a value equal to the actual level of performanceachieved during the period; and

‰ upon the termination of the restricted period, shares of stock equal to the number of time-lapseRSUs granted under our LTIP or issued as a result of an election to convert all or a portion of anIncentive Plan payment.

Payments Made Upon Death or Disability. In the event of the death or disability of a namedexecutive officer, in addition to the benefits listed above under “Payments Made Upon AnyTermination,” the named executive officer or designated beneficiary will be entitled to receive:

‰ a pro rata portion, based on the number of months completed of such performance period, of eachoutstanding grant of performance-based RSUs under our LTIP, at a value equal to the target levelof performance for the period;

‰ shares of our common stock equal to the number of cumulative time-lapse RSUs granted underour LTIP or issued as a result of an election to convert all or a portion of an Incentive Planpayment; and

‰ payments under the Company’s life insurance plan or benefits under the Company’s disabilityplan, as appropriate.

Payments Made Upon Voluntary Termination or Termination Without Cause. In the event of avoluntary termination or termination without cause for Messrs. Eckert or Sweetin (except for atermination without cause due to a general reduction in force or the specific elimination of a namedexecutive officer’s position, in which case the benefits would be substantially equivalent to thosedescribed under “Payments Made Upon Death or Disability”), no equity or retirement benefits wouldbe payable to these named executive officers since they are not yet eligible for retirement.

Payments Made Upon Termination for Cause. The benefits for a termination for cause aresubstantially equivalent to the benefits described above under “Payments Made Upon AnyTermination,” except that for all the named executive officers, no benefit under the SERP would bepayable. In addition, all outstanding grants of time-lapse RSUs and performance-based RSUs, as wellas any unvested FAC contributions under the RSP, would be forfeited by all named executive officers.

Payments Made Upon a Change in Control. As discussed above in “Change in ControlSeverance Agreements,” beginning on page 59, we have entered into severance agreements with eachof the named executive officers to provide certain severance benefits for them in the event of thetermination or “constructive termination” of their employment within three years following a “changein control” of the Company, as such terms are defined in the agreements. As is also discussed above,under the “best net” approach, the Company is not liable for the tax gross-up payments on behalf ofthose individuals whose severance payments would trigger excise tax penalties. In the tables below

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under the heading “Termination Upon Change in Control,” we assume the named executive officerswould pay any related excise tax penalties. The severance agreement for each such named executiveofficer provides that the Company will pay such named executive officer a lump sum severancepayment as described in “Change in Control Severance Agreements,” beginning on page 59.

Potential Post-Employment Payment Tables. The following tables reflect estimates of the totalamount of compensation due each named executive officer in the event of such executive’s terminationof employment by reason of death, disability, retirement, termination for cause, or termination ofemployment upon or following a change in control. There are no separate columns presented belowshowing amounts payable in the event of either a voluntary termination or a termination without causesince such amounts would be substantially equivalent to the amounts shown under Termination UponRetirement. The amounts shown below assume that such termination was effective as of September 30,2016 and are estimates of the amounts which would be paid out to the executives upon suchtermination. The actual amounts to be paid out can only be determined at the time of such executive’sseparation from the Company.

Kim R. Cocklin

TerminationUpon

Death($)

TerminationUpon

Disability($)

TerminationUpon

Retirement($)

TerminationFor

Cause($)

TerminationUpon/

FollowingChange inControl($)

Cash Severance — — — — 5,576,873

Equity

Time-Lapse Restricted Stock Units 5,899,960 5,899,960 5,899,960 — 5,899,960

Performance-Based Restricted StockUnits 1,452,074 1,452,074 1,452,074 — 1,452,074

Total 7,352,034 7,352,034 7,352,034 — 7,352,034

Retirement Benefits

Pension Account Plan 232,598 294,574 232,598 232,598 300,195

Supplemental Executive RetirementPlan 21,588,276 19,966,491 19,936,205 — 19,936,205

Retirement Savings Plan 577,222 577,222 577,222 577,222 607,483

Total 22,398,096 20,838,287 20,746,025 809,820 20,843,883

Other Benefits

Health & Welfare — — — — 25,738

Total 29,750,130 28,190,321 28,098,059 809,820 33,798,528

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Michael E. Haefner

TerminationUpon

Death($)

TerminationUpon

Disability($)

TerminationUpon

Retirement($)

TerminationFor

Cause($)

TerminationUpon/

FollowingChange inControl($)

Cash Severance — — — — 2,521,854

Equity

Time-Lapse Restricted Stock Units 2,861,212 2,861,212 2,861,212 — 2,861,212

Performance-Based Restricted StockUnits 477,354 477,354 477,354 — 477,354

Total 3,338,566 3,338,566 3,338,566 — 3,338,566

Retirement Benefits

Pension Account Plan 154,588 438,471 154,588 154,588 216,980

Supplemental Executive RetirementPlan 10,724,443 8,748,747 6,200,314 — 10,668,593

Retirement Savings Plan 537,473 537,473 537,473 537,473 567,734

Total 11,416,504 9,724,691 6,892,375 692,061 11,453,307

Other Benefits

Health & Welfare — — — — 27,794

Total 14,755,070 13,063,257 10,230,941 692,061 17,341,521

Bret J. Eckert

TerminationUpon

Death($)

TerminationUpon

Disability($)

TerminationUpon

Retirement($)

TerminationFor

Cause($)

TerminationUpon/

FollowingChange inControl($)

Cash Severance — — — — 2,025,437

Equity

Time-Lapse Restricted Stock Units 1,086,517 1,086,517 — — 1,086,517

Performance-Based Restricted StockUnits 366,276 366,276 — — 366,276

Total 1,452,793 1,452,793 — — 1,452,793

Retirement Benefits

Pension Account Plan — — — — —

Supplemental Executive RetirementPlan 9,595,060 5,678,319 — — 7,349,198

Retirement Savings Plan 124,841 124,841 124,841 124,841 185,364

Total 9,719,901 5,803,160 124,841 124,841 7,534,562

Other Benefits

Health & Welfare — — — — 38,032

Total 11,172,694 7,255,953 124,841 124,841 11,050,824

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Louis P. Gregory

TerminationUpon

Death($)

TerminationUpon

Disability($)

TerminationUpon

Retirement($)

TerminationFor

Cause($)

TerminationUpon/

FollowingChange inControl($)

Cash Severance — — — — 1,736,614

Equity

Time-Lapse Restricted Stock Units 2,319,219 2,319,219 2,319,219 — 2,319,219

Performance-Based Restricted StockUnits 254,660 254,660 254,660 — 254,660

Total 2,573,879 2,573,879 2,573,879 — 2,573,879

Retirement Benefits

Pension Account Plan 364,138 600,022 364,138 364,138 437,269

Supplemental Executive RetirementPlan 6,847,867 6,000,909 6,328,138 — 6,480,215

Retirement Savings Plan 1,293,129 1,293,129 1,293,129 1,293,129 1,323,390

Total 8,505,134 7,894,060 7,985,405 1,657,267 8,240,874

Other Benefits

Health & Welfare — — — — 24,215

Total 11,079,013 10,467,939 10,559,284 1,657,267 12,575,582

Marvin L. Sweetin

TerminationUpon

Death($)

TerminationUpon

Disability($)

TerminationUpon

Retirement($)

TerminationFor

Cause($)

TerminationUpon/

FollowingChange inControl($)

Cash Severance — — — — 1,664,946

Equity

Time-Lapse Restricted Stock Units 2,254,803 2,254,803 — — 2,254,803

Performance-Based Restricted StockUnits 254,660 254,660 — — 254,660

Total 2,509,463 2,509,463 — — 2,509,463

Retirement Benefits

Pension Account Plan 239,136 638,312 239,136 239,136 291,462

Supplemental Executive RetirementPlan 7,441,553 3,824,931 — — 6,740,241

Retirement Savings Plan 847,124 847,124 847,124 847,124 877,385

Total 8,527,813 5,310,367 1,086,260 1,086,260 7,909,088

Other Benefits

Health & Welfare — — — — 32,812

Total 11,037,276 7,819,830 1,086,260 1,086,260 12,116,309

In the tables above, we have shown the severance compensation and employee benefits to beprovided in the aggregate to each named executive officer in the event of each of the terminationscenarios. In each scenario, there are differences in how equity, retirement, and health and welfarebenefits are determined. The discussion below provides more specific information on the retirementbenefits under each of the various scenarios as well as the health and welfare benefits payable only inthe event of a termination of a named executive officer pursuant to a change in control.

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Termination Upon Death. The SERP benefit is the sum of the following:

‰ two times final average earnings (base salary plus annual payment under the Incentive Plan)less the amount paid through the Company’s group life insurance plan;

‰ a life annuity benefit of 50 percent of final average earnings (base salary plus annualpayment under the Incentive Plan) payable to the surviving spouse;

‰ a temporary life annuity benefit of 25 percent of final average earnings (base salary plusannual payment under the Incentive Plan) payable to dependent children until children reachthe age of 18 years;

‰ the PAP plan benefit equal to the account balance at the time of death; and

‰ the RSP plan benefit equal to the account balance at the time of death.

Termination Upon Disability. The SERP benefit is the sum of the following:

‰ a monthly benefit based on 60 percent of compensation (base salary plus annual paymentunder the Incentive Plan) less the amount paid from the Company’s group disability plan,with the net benefit payable as a temporary benefit until the age of 65 years;

‰ regular retirement benefit, as described below in “Termination Upon Retirement,” payable atthe age of 65 years;

‰ the PAP plan benefit equal to the value of the projected age 65 monthly benefit assuminglevel future earnings from date of disability; and

‰ the RSP plan benefit equal to the account balance at the time of disability.

Termination Upon Retirement. At September 30, 2016, only Messrs. Cocklin, Gregory andHaefner were eligible for retirement. The SERP benefit at retirement is the lump sum benefit based ona target benefit of 60 percent of final average earnings (base salary plus annual payment under theIncentive Plan) less an offset for the benefits to be paid from the tax-qualified PAP or the FACcontributions portion of the RSP, as applicable, which would be reduced if retirement were to occurprior to age 62 or the service period in the SERP were less than ten years. In addition, the followingbenefits are payable at retirement:

‰ the PAP plan benefit equal to the account balance at the time of retirement; and

‰ the RSP plan benefit equal to the account balance at the time of retirement.

Termination Upon Change in Control. The SERP benefit upon termination pursuant to a changein control is equal to the same retirement benefits described above with respect to “Termination UponRetirement,” with the following additional provisions:

‰ there is no reduction applied to the earned benefit in the event that the named executiveofficer has less than 10 years of service;

‰ there is no reduction applied to the earned benefit for early commencement prior to age 62;

‰ the named executive officer is immediately vested in the accrued benefit;

‰ the PAP benefit includes the accrued benefit at the time of termination plus an additionalthree years of earned compensation credits; and

‰ the RSP benefit includes the accrued benefit at the time of termination plus an additionalthree years of Company matching contributions (and for Mr. Eckert only, an additional threeyears of FAC contributions).

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Health and Welfare Benefits. The Company provides supplemental benefits in the form ofhealth and welfare benefits only in the event of the termination of a named executive officer pursuantto a change in control. The supplemental health and welfare benefits reported in the “Potential Post-Employment Payment Tables” above, beginning on page 62, represent the following benefits: (i) allmedical, dental, vision and any other health benefits which qualify for continuation coverage underCode Section 4980B for a period of 18 months from the date of termination; (ii) payment of a lumpsum equal to the present value of the cost to the Company of providing those benefits for an additional18-month period; and (iii) payment of a lump sum equal to the present value of the cost to theCompany of providing accident and life insurance benefits as well as disability benefits for a period of36 months from his date of termination, equal to such benefits in effect for the officer at the time of thechange in control.

OTHER MATTERS

Shareholder Proposals

In the event a shareholder intends to present a proposal at our annual meeting of shareholders onFebruary 8, 2017, in accordance with the Company’s bylaws, the shareholder must be a shareholder ofrecord on the record date, December 15, 2016, who shall continue to be entitled to vote at the annualmeeting. In addition, such shareholder must mail a notice of such proposal so that it is received by theCorporate Secretary at our principal executive offices by January 17, 2017, the 25th day following theday on which notice of the meeting is to be sent, December 23, 2016. Any such proposal must alsoinclude the information required by the Company’s bylaws. In addition, in the event a shareholderintends to present a proposal at our 2018 annual meeting of shareholders, if such proposal is to beincluded in our proxy statement relating to such meeting, it must be received by the CorporateSecretary at our principal executive offices no later than August 25, 2017 and it must be preparedaccording to applicable law, as determined by the Company.

Other Business

We know of no other business that may come before the annual meeting. However, if any othermatters are properly brought before the meeting by the management or any shareholder, it is theintention of each person named in the accompanying proxy to vote such proxy in accordance with hisor her judgment on such matters. The proxy confers discretionary authority to the proxy holders to voteon any matter not included in this proxy statement that is properly presented to the shareholders at themeeting.

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Annual Report

You may obtain a copy of our 2016 Annual Report, which includes our Annual Report onForm 10-K for the fiscal year ended September 30, 2016, including the financial statements andthe financial statement schedules included therein, free of charge on our website or by contactingus as noted below. In addition, the exhibits of the Annual Report on Form 10-K are availableupon payment of charges that approximate our cost of reproduction. If you would like to receivea copy of these exhibits, or our 2016 Annual Report, please visit our website atwww.atmosenergy.com, call Investor Relations at 972-855-3792 or mail your written request toInvestor Relations, Atmos Energy Corporation, P.O. Box 650205, Dallas, Texas 75265-0205.

By Order of the Board of Directors,

Louis P. GregorySenior Vice President, General Counseland Corporate Secretary

Dallas, TexasDecember 23, 2016

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